The consequences of the referendum in the United Kingdom
In 2015, 15.7 million British tourists visited Spain, part of a record year for international tourism with 68 million foreign travellers. The British number is back to the levels pre-crisis which fell to a low in 2010 of 12.4 million, signifying a growth of 3.2 million more visitors over the last five years. So far this year, the tendency hasn’t changed. In the first quarter 2.6 million Brits arrived, 20.1% up on 2015 and 21.8% of the total number of foreign visitors.
This could all change after June 23. This is the date which has been chosen by the British Cabinet for a referendum when the British residents will have to decide whether to remain or to leave the European Union. Apart from the strategic and political implications and exit by the U.K., it would have very negative effects on the arrivals of British tourists in Spain.
Firstly, the devaluation of the pound sterling, which has so far this year already collapsed by 9% against the euro, and if the great British Public decide to go it alone the British currency is likely to fall a great deal more, a devastating effect for the Spanish economy. Over the six years of the crisis the pound has gained nearly 30% with respect to the euro. As seen with the devaluation of the Russian currency last year.
Despite the general two and a bit hour flights, the British tourists usually stay for longer than a weekend; in winter the climate attracts hoards along the Spanish coastline. Given that many of the Brit visitors are retired, they can currently benefit from free access to the Spanish Health Services. If the exit is confirmed, this universal and free access would end and the United Kingdom would have to renegotiate a new convention with the Spanish Government to establish mechanisms for the repayment by the UK of the massive costs they face in Spanish Health covering the free service at use. The latest data from the British Ministry for Health revealed Spanish tourists cost the Spanish Government 30 million € a year and compared to the Spaniard obtaining free healthcare in Britain, the UK reclaims only some four million €.
After several holidays, many tourists consider buying property attracted, among other things, by the lower prices. In 2008 foreign purchasers made 5% of the total house sales, and a percentage which has continued to grow to 13.1% last year.
This increase has been decisive for the British who have now acquired one in every four properties in Spain.
In the new scenario for a fractured Europe, the British would be submitted into difficulties with the arrival of migrants from outside the EU. Trying to save the situation and to attract large investors, Spain introduced at the end of 2013, the idea of an express visa, granted only to qualified workers and those who gave an undertaking to invest great sums. This was an attempt by the Rajoy administration to equalise the rights of all visitors, be they from the EU or otherwise.
Since its thirty month introduction Spain has benefitted by just over one billion (1.048 billion €). Of the total, 910.6 million (86.9%) invested in property, and 75 million in investment capital (fundamentally buying debt for a minimum of two million € per investor) and 62 million for new business enterprises.