Published on
March 11, 2026
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Cyprus and Greece were positioned on exceptionally strong tourism foundations at the start of 2026, while Spain continued to stand as one of Europe’s dominant destinations in terms of absolute visitor numbers. At the same time, Cyprus and Bosnia and Herzegovina began to experience clear pressure or high‑risk conditions linked to the Middle East war, whereas for much of the rest of Europe the impact has so far been assessed mainly as potential and modelled rather than fully visible in hard arrival data.
A record‑high starting point for key Mediterranean destinations
In 2025, Cyprus was reported to have welcomed 4.53 million tourist arrivals, representing a historic peak and a 12.2 percent increase compared with 2024. Between January and November 2025, tourism revenue in Cyprus was estimated at around €3.6 billion, which reflected growth of 15.3 percent over the same period a year earlier and led officials to characterise 2025 as the most successful year in the history of Cypriot tourism. The United Kingdom was identified as the main source market, followed by other European Union countries and nearby regional markets, which means that the island’s performance remained deeply tied to European outbound demand. Cyprus, as a favoured Eastern Mediterranean destination located close to the Middle East, therefore entered 2026 in a position of record strength but with a high degree of exposure to regional tensions and geopolitical shocks.
Greece was similarly reported to have closed 2025 with record tourism indicators. Provisional data from the Bank of Greece showed that inbound travel reached 37.98 million visitors in 2025, representing a 5.6 percent increase on 2024 and marking a third consecutive year of rising arrivals. Travel receipts were estimated at €23.6 billion, which amounted to a 9.4 percent year‑on‑year increase, meaning that revenue growth outpaced the expansion in visitor numbers and pointed toward higher average spending and a shift toward more value‑driven tourism. The Tourism Minister described 2025 as the best year ever for Greek tourism, while material from the Bank of Greece and National Bank of Greece indicated that the sector was moving along a 3–5 percent arrivals growth trajectory in line with broader global trends and supported by positive expectations in accommodation and air transport. This strong footing left Greece both robust and exposed when the Middle East conflict began to reshape travel corridors across the wider region.
Spain’s tourism sector was also reported to have reached new heights in 2025. An estimated 97 million international visitors travelled to Spain that year, a 3.5 percent increase compared with 2024 and a new all‑time record that consolidated Spain’s position among the most visited countries in the world. Foreign tourist spending was placed at around €135 billion, approximately 6.8 percent higher than in 2024, which indicated that spending was growing faster than arrivals and underlined a structural shift toward higher‑spending visitor segments. While expectations that the symbolic threshold of 100 million visitors might be exceeded were not met, the shortfall was mainly attributed to higher prices and softer demand from markets such as France and Germany rather than to the Middle East conflict. Spain’s tourism model remained heavily anchored in European demand, which provided resilience but did not fully insulate it from global aviation shocks and long‑haul volatility.
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Bosnia and Herzegovina, by contrast, represented a smaller European tourism market in absolute terms but one that had come to depend heavily on arrivals from the Gulf region. Sarajevo’s role as a hub with direct flights from Saudi Arabia, Qatar, the United Arab Emirates and other Gulf states created a critical access point for high‑spending visitors from the Middle East and for connecting passengers from Asia and Australia. Forecasts for 2026 suggested that total tourist traffic in Bosnia and Herzegovina could fall by up to 20 percent if the conflict continued and flights from Gulf countries remained suspended, demonstrating how tightly the destination had become linked to a single, highly vulnerable air corridor.
At a broader regional level, UN Tourism reported that global arrivals grew by around 4 percent in 2025 and that Europe benefited from this continued recovery, consolidating gains made since the pandemic. At the same time, analysis from Tourism Economics, part of Oxford Economics, indicated that the Middle East war had the potential to reverse an earlier projection of 13 percent growth in Middle East arrivals for 2026 and instead produce an 11–27 percent decline, with knock‑on effects for Europe through air connectivity and transit disruptions. This meant that markets such as the United Kingdom, Ireland, France, Germany, Italy and the Nordic countries were being viewed less in terms of immediate falls in recorded arrivals and more in terms of heightened exposure to external shocks in aviation networks.
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Visitor volumes and relative tourism weight
When arrivals in 2025 were compared across the highlighted destinations, Spain was clearly positioned as the volume leader, Greece was identified as a major Mediterranean success story, Cyprus was seen as a smaller but highly tourism‑dependent market, and Bosnia and Herzegovina was recognised as a niche destination with concentrated exposure to Gulf traffic.
Spain was reported to have hosted 97 million international visitors in 2025 and to have generated around €135 billion in foreign tourist spending, placing the country firmly among the top global tourism destinations by both volume and value. Greece, with 37.98 million international visitors and €23.6 billion in tourism receipts in 2025, was described as having reached its third straight record year, with strong performance recorded across many regions of the country. Cyprus, with 4.53 million visitors and approximately €3.6 billion in tourism revenue in the first eleven months of 2025, was portrayed as having reached the highest numbers in its history, while continuing to rely heavily on the United Kingdom and other European markets. Bosnia and Herzegovina, with several million visitors but far smaller absolute volumes than the other three, was shown to be highly dependent on Gulf carriers and on direct services into Sarajevo, with those links having become essential for attracting visitors from the Middle East and for routing travellers from Asia and Australia.
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This distribution of volumes and dependencies created a landscape in which Spain and Greece possessed significant economic weight and diversified demand, whereas Cyprus and Bosnia and Herzegovina, though much smaller, displayed a high degree of vulnerability to external shocks in perception, connectivity and source‑market behaviour.
Scenario losses in the Middle East and global spillovers
Tourism Economics and Oxford Economics produced scenario analyses to estimate how the Middle East conflict might alter tourism flows. In a more optimistic, early‑resolution case, inbound arrivals to the Middle East in 2026 were projected to fall by around 11 percent compared with earlier forecasts, a swing that was translated into approximately 23 million fewer visitors and around $34 billion in lost spending. In a more pessimistic, prolonged conflict scenario, the decline in arrivals was projected at 27 percent relative to previous expectations, corresponding to roughly 38 million fewer tourists and up to $56 billion in lost expenditure in the region.
These modelling results were explicitly linked to temporary closures of airspace, flight bans, higher perceived risk among travellers and reduced connectivity through Gulf and Iran‑adjacent corridors, which serve as major bridges linking Europe and Asia. For Europe, the implications were not limited to lower arrivals into the Middle East; they also encompassed fewer transit passengers passing through European hubs, higher long‑haul fares, longer journey times and a potential re‑direction of demand away from destinations perceived as lying closer to or associated with the conflict. Thus, even where no direct security incidents were being recorded, European destinations were being drawn into the shock via shared aviation infrastructure and traveller sentiment.
Cyprus: visible booking slowdown after a record year
Against this backdrop, Cyprus moved from a record‑setting 2025 into a period marked by fragility in bookings once hostilities escalated in the Middle East. The island’s 4.53 million visitors in 2025 and the strong forward bookings that followed had created an expectation of continued expansion, but those expectations were challenged after a US–Israel strike on Iran and the subsequent intensification of conflict.
The Deputy Tourism Minister of Cyprus confirmed that a slowdown in bookings and a decline in reservations were observed in the days following those events, particularly among visitors from the United Kingdom, which remained the country’s largest source market. This weakening was reported even though Cyprus remained on safe travel lists and continued to be characterised by local authorities as a secure destination, underscoring the importance of perceived regional proximity rather than conditions on the ground. Forward bookings for June and the later summer months of 2026 were also described as having become softer, especially in long‑haul segments, although it was also indicated that no major tour operators had withdrawn their summer programmes for Cyprus at that stage.
At the micro level, individual business data provided a concrete illustration of the developing stress. A short‑term rental operator managing 15 properties in Limassol, Larnaca and Lefkara reported that 50 nights were cancelled by 13 guests in the space of a single week, which was estimated to have reduced expected income for that month by about 35 percent. Other local tour operators and accommodation providers reported rising cancellation volumes for trips scheduled over the subsequent weeks, leading industry associations to call for urgent meetings with the Deputy Ministry of Tourism to discuss potential support and mitigation measures.
Although flights from European origins were reported to be continuing normally, the U.S. State Department raised its advisory on travel to Cyprus to Level 3, urging travellers to reconsider travel, while several European foreign ministries issued more cautious guidance. These advisories, amplified by extensive media coverage of the conflict, were seen to have depressed demand among risk‑averse travellers even though no direct threat on the island had been identified. The Deputy Minister of Tourism stressed that Cyprus was, had been and would remain a secure destination, but industry sources noted that potential visitors were being influenced by headlines and by the island’s geographical proximity to the warzone and were therefore re‑evaluating or postponing holiday plans.
As of early 2026, no official forecast had been published specifying a precise percentage drop in full‑year arrivals for Cyprus. Nevertheless, when the advisory environment, reported cancellations and softer forward bookings were considered together, a clear downside risk was being signalled relative to the 4.53‑million baseline, particularly for non‑EU and long‑haul markets that are more sensitive to perceived security risk and route disruptions.
Bosnia and Herzegovina: a sharp expected contraction in traffic
In Bosnia and Herzegovina, the impact of the Middle East conflict on tourism was described as direct and severe. All scheduled flights connecting Sarajevo with Gulf countries, including services to Saudi Arabia, Qatar, the United Arab Emirates, Abu Dhabi and Dubai, were reported to have been cancelled as a result of war‑related airspace restrictions. This led to an immediate halt in arrivals from those markets, which had been central to the country’s recent tourism growth strategy.
Tourism representatives reported that the drop in tourist arrivals from the Middle East had reached 100 percent and that cancellations from Asia and Australia had also reached very high levels, since many travellers from these regions had been relying on Gulf hubs such as Dubai and Doha to reach Bosnia and Herzegovina. A period of at least five to six months of suppressed arrivals from these destinations was anticipated, even in the event that hostilities were brought to an end relatively quickly, because schedules and traveller confidence would require time to recover.
The president of the Sarajevo Canton Tourist Board estimated that total tourist traffic in Bosnia and Herzegovina could decline by around 20 percent on an annual basis in 2026 if the war continued and Gulf flights remained unavailable. Such a reduction would imply substantial revenue losses for hotels, tour guides, restaurants and related services, especially in Sarajevo Canton, where Gulf family tourism had become a major driver of occupancy, retail spending and seasonal employment. Because of this dependency, Bosnia and Herzegovina emerged as the clearest European example of a country facing a quantifiable, conflict‑induced tourism contraction tied directly to disrupted Middle East airspace and flight cancellations.
Greece and Spain: high exposure and indirect risks
In Greece, the conflict was not yet associated with a statistically documented decline in overall arrivals, but it was recognised that the country’s position in the eastern Mediterranean and its air links with the Middle East created significant exposure. Some carriers were reported to have cancelled or reduced regular flights between Greek airports and Middle Eastern hubs, affecting both point‑to‑point leisure routes and connecting itineraries that carried Europe–Asia traffic via Greek gateways. Analysts and local experts also noted that changing safety perceptions and evolving travel advisories regarding the wider region could weigh on demand, especially among long‑haul travellers who closely monitor risk assessments and route stability before booking.
Furthermore, rising energy prices, partly driven by conflict‑related uncertainty, were said to be increasing airfares and operating costs, putting additional pressure on visitors and on Greek hospitality businesses that were already facing elevated electricity and heating expenses. However, because arrivals and revenues in 2025 had reached record levels and intra‑European demand remained strong, the prevailing view was that Greek tourism was operating from a position of strength while navigating elevated risk, rather than experiencing an immediate collapse in visitor numbers.
Spain’s exposure was primarily described in indirect terms. The country’s 97 million visitors and €135 billion in foreign tourist spending in 2025 reflected a robust and diversified tourism base that was driven largely by European and domestic demand. The failure to reach or exceed the symbolic 100‑million‑visitor mark was attributed principally to the effects of higher prices and softer demand in some neighbouring markets rather than to the conflict in the Middle East.
Nevertheless, disruptions and temporary closures affecting key Middle Eastern aviation hubs were reported to be altering some international travel flows, causing flight cancellations or diversions and increasing travel times and costs on certain Europe–Asia routes. For Spain, this created the risk that demand from Asian and Oceania markets, which often used Gulf hubs to connect to Spanish destinations, could be dampened if flights became less convenient or more expensive. Up to now, official Spanish tourism data had not shown a clear, conflict‑driven decline in arrivals, but Spain was being regarded as a market where impacts might surface selectively in long‑haul segments rather than in headline arrival volumes.
Structural mechanisms and macroeconomic implications for Europe
Across the European destinations under consideration, several common mechanisms were identified as channels through which the Middle East conflict was affecting tourism.
Temporary closures and restrictions of Middle Eastern airspace were affecting flight networks used by European and global carriers, forcing Europe–Asia routes to be shortened, lengthened or rerouted via alternative paths over the Caucasus, Central Asia or southern corridors through Egypt, Saudi Arabia and Oman. Longer flying times and higher fuel consumption were increasing costs for airlines, leading to schedule reductions, flight suspensions and fare increases on some routes. Sarajevo’s loss of direct Gulf links represented an extreme case, with immediate and complete loss of arrivals from key markets and complications for travellers from Australia and Asia who had previously used Gulf hubs as transfer points.
Beyond connectivity, Europe’s tourism demand remained highly sensitive to perceptions of safety. Destinations located nearer to the Middle East, such as Cyprus and parts of Greece, were more directly affected by media narratives and advisory changes that prompted travellers to re‑assess perceived risk. UN Tourism reported that the Middle East welcomed about 100 million tourists in 2025, equivalent to roughly 7 percent of global international arrivals, so any double‑digit drop in that region was expected to reverberate through Europe’s networks because of shared carriers, shared hubs and intertwined itineraries. Analysts therefore emphasised that even in the absence of security incidents inside European destinations, regional proximity and association with the wider conflict sphere could significantly dampen bookings and prompt reallocation of trips to destinations perceived as safer or more distant.
From a macroeconomic perspective, UN Tourism and Oxford Economics highlighted that tourism’s share of GDP and employment had increased in many Middle Eastern and connected markets, meaning that an 11–27 percent fall in arrivals now represented a larger economic shock than similar percentage changes in earlier decades. For Europe, countries whose coastal or urban economies were strongly reliant on tourism, such as Cyprus, many Greek islands and parts of the Balkans including Bosnia and Herzegovina, were considered more vulnerable even to moderate declines in arrivals. Reductions in visitor numbers could rapidly feed into local GDP, employment in accommodation and food services, transport revenues and government tax receipts.
In Bosnia and Herzegovina, the anticipated 20 percent contraction in tourist traffic implied substantial losses across the tourism value chain, with Sarajevo Canton being particularly exposed due to its reliance on Gulf family tourism for hotel occupancy, retail sales and seasonal jobs. In Cyprus, the combination of a record 2025 and a subsequent slowdown in bookings meant that any prolonged weakness in 2026 could be expected to weigh heavily on national tourism receipts and on broader economic performance, given the estimated double‑digit contribution of tourism to GDP and employment. Spain and Greece, which had already been moving toward higher‑value tourism and a broader geographic spread of demand, were better placed to absorb a moderate reduction in long‑haul arrivals thanks to resilient intra‑European and domestic markets, though both remained alert to rising costs and evolving sentiment among distant travellers.
Tourism authorities and industry stakeholders in the Mediterranean region were adapting their strategies in response to these pressures. In Cyprus, measures such as additional marketing funding, landing‑fee waivers and closer coordination among airlines, hoteliers and government were being considered to retain capacity, reassure core markets and avoid a self‑reinforcing cycle in which reduced supply further depressed demand. Analysts across the Mediterranean stressed that managing unpredictability would require more than crisis communication: diversification of source markets, prioritisation of quality over pure volume, and development of inland, cultural and non‑beach products were seen as necessary steps to attract visitors who are less sensitive to regional security narratives.
Looking ahead, the clearest hard decline figures in Europe were associated with Bosnia and Herzegovina, where an annual drop of up to 20 percent in tourist arrivals was being anticipated if Gulf flights remained suspended, and with Cyprus, where booking data pointed to a softer but still significant downturn risk from a record‑high starting point. In Greece and Spain, the narrative remained focused on elevated risk and the need for careful management, rather than on an actual collapse in visitor numbers, as both countries continued to operate near record levels while monitoring the effects of disrupted Europe–Asia corridors, higher airfares and cautious long‑haul sentiment. In the wider European market, including the United Kingdom, Ireland, France, Germany, Italy and the Nordic countries, most of the identified impact remained within the realm of risk projections and connectivity‑based exposure, rather than confirmed declines in 2026 arrivals.
Taken together, these developments showed that the Middle East conflict was already reshaping European tourism through disrupted airspace, altered traveller psychology, rerouted itineraries and uneven economic shocks. Bosnia and Herzegovina and Cyprus appeared to be situated at the sharpest end of the immediate impact, whereas Greece, Spain and the broader European market were being required to navigate a more complex environment of risk and resilience, with outcomes likely to depend heavily on how aviation networks, advisories and traveller perceptions evolved over the remainder of 2026.
