Tenerife has reinforced its economic growth during the first half of the year, largely driven by the robust performance of its tourism sector. The latest Boletín de Coyuntura Económica Insular (Island Economic Situation Bulletin), produced by the Chamber of Commerce in collaboration with the Cabildo (Island Council), highlights the “excellent health of tourism,” which continues to be the primary engine for the island’s economic and employment growth.
This thriving tourism industry has a ripple effect, positively influencing other sectors such as commerce, where visitor spending complements that of the local population, leading to job creation and a notable decrease in unemployment. Santiago Sesé, President of the Chamber of Commerce, underscores the vital role of tourism and calls for collective efforts to maintain competitiveness and address future challenges effectively.
Lope Afonso, Vice-President of the Cabildo and Councillor for Tourism, expressed satisfaction with the figures, noting that Tenerife is leading economic growth in the Canary Islands. He emphasized that the tourism sector is firmly established as a key driver of the island’s economy, which must be managed responsibly with a focus on economic, social, and environmental sustainability.
Afonso highlighted the administration’s commitment to further improving these figures by promoting areas such as training, innovation, digitalization, and sustainability to enhance productivity and the quality of life for all residents of Tenerife. Tourism on the island has set new records, with 1,654,240 visitors recorded in the first half of the year, representing a 10.8% increase compared to the previous year. By the end of June, Tenerife had welcomed 3,631,280 tourists, marking a 13% growth.
The Labour Force Survey shows that Tenerife now has 425,080 employed workers, with unemployment dropping by 10,670 compared to the previous year. The island’s current unemployment rate stands at 13.66%, the lowest since 2007, which Sesé describes as a positive development, highlighting the island’s ability to generate jobs.
Investment and Sectoral Insights
On the investment front, 62.8% of companies maintained stable activity during the second quarter of the year, and 65% anticipate stable results over the summer. However, a seasonal moderation in economic activity was observed in the second quarter compared to the first. Despite this, year-on-year comparisons show continued growth in employment and significant reductions in registered unemployment.
Port activity also experienced a substantial boost, with the movement of goods increasing by 8.6% compared to the previous quarter. On an annual basis, maritime transport of goods rose by 22.6%, outpacing the overall Canary Islands growth rate of 17.1% by 5.5 percentage points.
The industrial sector saw modest growth, with a 0.2% increase in the number of industrial companies during the quarter (adding two new companies) and a 1.3% increase compared to June 2023 (seventeen additional companies).
In the services sector, as is typical for this time of year, the number of companies registered with Social Security declined by 0.5% (109 fewer companies compared to March). However, on a year-on-year basis, there was a 0.4% increase in the second quarter (87 additional companies).
Company Start-Ups and Economic Indicators in Tenerife
Despite a 3.5% decline in company start-ups in June compared to the previous year, the Canary Islands still saw the establishment of 360 new mercantile companies. The number of companies dissolved during this period was 64, representing a 13.5% decrease.
Despite this slight decline, recorded by the National Statistics Institute (INE), the region achieved its fifth-best June for company incorporations in the historical series. Additionally, over 12.85 million euros were subscribed in June, reflecting a significant 259.09% increase compared to the same month last year.
Overall, Tenerife’s economic growth continues to be driven by its thriving tourism sector, which has a positive impact on other industries and contributes to job creation and economic stability. The island’s leadership remains focused on ensuring sustainable growth while addressing the challenges that accompany such success.
