Why Iceland's Tourism Boom May Finally Be Over

The tourism boom that saved Iceland from economic crisis is slowing further, according to new tourism numbers released by the Icelandic Tourist Board. Fueled for nearly eight years by international travelers, the tourism industry may be reaching a breaking point, spelling an uncertain future for the Icelandic economy.

In 2018, 2.3 million people visited Iceland, a 5.5 percent increase from the year before, according to data released this month. The Iceland-based media site Túristi first reported the news.

On its own, the year-over-year increase sounds strong, but it points to a slowing trend. While the number of international visitors to Iceland grew by 39 percent in 2016, the increase in 2017 was 24 percent. That was the first time tourism growth slowed since the boom started in 2011.

The new figures back up the findings in a report by researchers at Arion Bank, published in October. Called “Tourism in Iceland: Soft Landing or Belly Flop”, the report predicts a dramatic drop in growth, citing overburdened airlines and rising prices inside of Iceland. By 2021, the group projects growth somewhere between 2 and 3 percent.

So what’s going on?

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Source: Skift