The end of year review from the Irish Tourism Industry Confederation (ITIC) projects that visitor numbers and expenditure by tourists will start to grow again in 2026.
ITIC forecasts 5-7pc revenue growth in 2026, contingent on global stability, expanded air access, and supportive policies. These include lifting the Dublin cap, aiding regional airports, mitigating costs, investing appropriately, and resolving bottlenecks.
Its annual end of year projection says that air and sea access appears promising early in the year. International projections from Tourism Economics suggest 4.7pc inbound growth for Northern Europe, bolstered by modest IMF economic forecasts. Oil prices may drop to $56 per barrel, potentially lowering airfares. It says the US market could see distortions from its 250th independence anniversary and FIFA World Cup hosting.
For 2025, the year just ending, ITIC projects 6.16m overseas visitors, a 6pc drop from 2024, with their expenditure totalling €5.27bn, down 13pc. Domestic tourism added €3.62bn. However, a notable discrepancy exists between Central Statistics Office (CSO) data and industry insights. While CSO figures suggest sharp declines, business surveys from Fáilte Ireland and other sources indicate a flatter or marginally down performance. Airport passenger numbers rose, major attractions held steady, and Dublin hotel occupancy increased by 1.5pc.
Early fears of tariffs and a potential transatlantic trade war, which loomed large in the first quarter, failed to materialise. Instead, the industry demonstrated resilience, contributing an estimated €8.89bn to the national economy through overseas visits and domestic tourism.
Demand from North America proved robust, with US visitors up 4pc and Canadians 8pc, driven by favourable exchange rates, enhanced air access, and targeted marketing. In contrast, key markets like Britain fell 4pc, France 13pc, and Germany 8pc. North America emerged as the most valuable segment, generating €1.933bn with an average spend of €1,282 per visitor. Continental Europe contributed €1.726bn (€859 per head), Britain €1.61bn (€494 per head), and other markets €445m. Overall, spend per market grouping declined as average trip lengths shortened.
Domestically, 2025 saw 15.44m trips by Irish residents, down 7pc, with 34.144m nights spent, also down 7pc. Expenditure rose slightly by 1pc to €3.62bn, averaging €235 per person. Holidays topped the reasons for trips, followed by visiting friends and relatives. The Southern region, encompassing counties like Cork, Kerry, and Clare, claimed 49pc of overnight summer trips.
Costs remained the sector’s chief concern. Eurostat data ranked Ireland as the EU’s second most expensive country, with rising labour, food, energy, and insurance expenses pushing up consumer prices and eroding margins. Businesses navigated these pressures while maintaining service quality.
Government actions offered some optimism. Tourism shifted to the Department of Enterprise, Tourism and Employment, aligning it with economic priorities. Minister Peter Burke secured a VAT rate cut to 9pc for hospitality from July 2026, despite opposition, providing a buffer against escalating costs. A new national tourism policy, unveiled late in the year, targets a 50pc rise in overseas revenue over five years via 71 recommendations.
ITIC members praised the ambition but said that there is a need to curb inflation running at 6pc to make growth meaningful. It expressed disappointment over the lack of committed investment, and capacity issues, like the Dublin Airport passenger cap, slowing hotel development, and upcoming short-term letting laws, pose risks to implementation.
The sector’s resilience shone through, employing 226,800 people nationwide and serving as regional Ireland’s largest indigenous employer. Over-reliance on US visitors worries leaders, prompting calls for diversification into Europe and Asia to hedge against volatility. A market-diversification strategy is in development, requiring government funding.
It also urges action on data gaps in official statistics, incentivising new accommodation, fair short-term rental regulations, faster infrastructure like EV charging, and immediate Dublin Airport expansion.
The report shared: “No matter the global uncertainty, Irish tourism can’t be outsourced and offshored. It is here to stay and needs to be supported.”
See full report here.
