Report on the Record Year

REPORT ON THE RECORD YEAR

Published by: HUNGARIAN TOURISM AGENCY Dr Zoltán Guller Chief Executive Officer H-1027 Budapest, Kacsa utca 15-23. Design: Mediator Print by: Bonex Press Kft.

TOURISM IN HUNGARY 2019 CONTENT

Prologue 05

Tourism as the driver of economy 06 Gellért Thermal Bath

International outlook 07

Main data on Hungarian tourism 10

Visitor numbers in accommodation establishments 11

Most popular accommodation types and regions 18

Change in main feeder markets 24

Changes in domestic and inbound tourism 28

Meetings Industry key data 34

Competitor analysis 36

What characterises 2020? 38

03 DEAR READER,

Over the past four years, the Hungarian From January this year, the National Tourism Agency has strived to Tourism Data Supply Centre covers ensure that tourism, one of the most the entire spectrum of tourist successful sectors of the Hungarian accommodation establishments, economy, achieves better results year which is particularly important after year, and we have set the goal for because prior to 2020, there was no Hungary to become a leading regional monthly data collection on private tourism destination by 2030. and other accommodation. From the outset, digital data supply has The growth rate of Hungarian tourism provided valuable and up-to-date has exceeded both the EU and datasets to facilitate the operation worldwide average for many years. of accommodation establishments Since 2010, the number of inbound and for the Agency to plan marketing tourists has been steadily increasing activities and developments, which are and each year, the activity of domestic essential in the current situation. travellers has also been continuously growing. We were moving faster Now that the challenges are far from towards our goal than we had ever ordinary and entry restrictions make imagined possible. international travel unpredictable, it has become particularly important that This spring also brought about a new tourism in rural Hungary has resumed. situation in tourism, and since March Tourism is a particularly fortunate we have been working to put this sector as although it was quick to strategically crucial sector back on react to the crisis, it has also been the growth path. The Hungarian fast to recover. Government was among the first to announce an action plan to help The Hungarian Tourism Agency is tourism and hospitality; it would have using all means possible to ensure been impossible to take action any that its international partners remain faster, nor were measures of similar continuously informed, a purpose that proportion introduced in the sector is served by this publication. anywhere else in Europe.

In order to reboot tourism, instead Yours sincerely, of introducing austerity measures, the Government aided the recovery Dr. Zoltán Guller from the crisis through tax cuts and CEO continued developments, supporting Hungarian Tourism Agency businesses through this difficult period. After all, if there are guests, tourism has everything it needs.

04 05 TOURISM AS INTERNATIONAL TOURIST ARRIVALS 2019 THE DRIVER OF ECONOMY +4.8% +3.6% +3.9% Worldwide Europe Hungary Tourism has grown into one of economic stimulation and job creation Hungary’s major economic sectors, at a rate somewhat above the global Source: UNWTO Tourism Barometer 2020 which plays an important role in both average. GDP production and in employment, as well as in maintaining the balance of Tourism output has been setting payments. Our tourism indicators have records in Hungary every year since been continuously improving since 2010, and in 2019 we closed the best 2010, and 2019 also saw an expansion. tourism year ever. INTERNATIONAL In Hungary, tourism contributes to OUTLOOK

Preliminary calculations by the United The World Travel and Tourism Council Nations World Tourism Organization (WTTC) regularly examines the (UNWTO) registered 1.5 billion interna- economic effects of tourism. According tional tourist arrivals in 2019, up 3.8% to their analyses, in 2018 10.4% of the from the previous year. The sector expe- world’s GDP output could be linked to FOREIGN CURRENCY BALANCE OF INTERNATIONAL TRAVEL rienced an even faster growth rate than tourism (considering both direct and the average of the global economy. spill-over effects) and one tenth of all

2018 2019 2019/2018 International tourism revenues grew workplaces are also linked to the sector. by 3.6% in real terms worldwide in 2019, The contribution of tourism to Revenue (EUR million) 5 856 6 480 +10.8% with their value reaching USD 1,460 employment is also increasing billion. worldwide year by year. Expenditure (EUR million) 2 239 2 452 +9.5%

Balance (EUR million) 3 617 4 028 +11.5%

Source: National Bank of Hungary

06 07 According to the latest 2017 tourism which is also a substantial increase over THE ECONOMIC IMPACT OF TOURISM IN HUNGARY satellite account data, including indirect 11% in 2010. The data shows that over effects, tourism accounts for 10.6% of one third of those employed in tourism total domestic GDP, with a direct con- worked in the hospitality sector, 14% in tribution of 6.7%. The ratio of the value the road passenger transport sector, Estimated Total contribution to GDP (2019) 13.2% 13.2% increased by the multiplier was merely 9.4% in the cultural sector and 9% in the Employment (000s persons) 418 Contribution to GDP 8.7% in 2010, while by 2019, the total accommodation sector. contribution of tourism to GDP reached Total contribution to employment (2017) 9.6% 13.2%. The growing demand of both Tourism is typically the field of small and Source: National Bank of Hungary inbound and domestic tourism year medium-sized enterprises, with about after year, as well as the coordinated 175,000 enterprises operating in the sector-level developments implemented tourism sector, constituting one tenth in recent years which are still ongoing, of the national economy. The economic greatly promote the development of the significance of tourism lies in the fact Hungarian economy. that it is a sector that can be sustained without foreign capital that can be More than 400,000 people are em- profitably operated based on domestic ployed in areas related to tourism, and resources. the contribution to employment is 13%,

INTERNATIONAL TOURIST ARRIVALS (MILLION; 2019/2018)

2019 2019/2018

World 1460 +3.6%

Europe 745 +3.9%

Africa 73 +6.4%

America 220 +2.0%

Asia 361 +3.7%

Middle East 61 +2.0%

Source: UNWTO Tourism Barometer 2020

08 09 MAIN DATA ON VISITOR NUMBERS HUNGARIAN TOURISM IN ACCOMMODATION

NUMBER AND EXPENDITURE OF TOURISTS ESTABLISHMENTS

Balanced inbound and domestic visitor A total of 47,842 commercial accommo- numbers, high revenues and dynamically dation establishments were registered in growing SZÉP Card turnover character- Hungary in 2019, providing guests with a ised the sector in 2019. total of 217,218 rooms and 624,034 beds. 2018 2019 2019/2018 Capacities exceeded those of the previous In a review of the visitor numbers of year by 2%. Expenditure of inbound tourists (HUF million) 1 576 350 1 745 265 +10.7% commercial and other accommodation establishments in 2019, 16.2 million guests There is an approximately equal share of Expenditure of same-day tourists (HUF million) 125 309 149 529 +19.3% spent more than 42 million guest nights domestic and inbound tourism at com- in Hungarian accommodation estab- mercial accommodations, 53% of guests Expenditure of overnight tourists (HUF million) 1 451 041 1 595 736 +10.0% lishments. Guest numbers rose by 4.2% were domestic residents and 47% were

Average expenditure of inbound tourists per day (HUF) 17 984 19 001 +5.7% compared to the previous year, while the international visitors, while 51% of guest number of guest nights was 4.1% higher nights were domestic and 49% foreign. Expenditure of domestic overnight tourists (HUF million) 347 421 393 243 +13.2% than in 2018. The numbers show that more tourists came to Hungary in 2019 Although seasonality has declined in Average expenditure of domestic overnight tourists 5762 6634 +15.1% per day (HUF) than ever before. Compared to the 2010 recent years, 14.2% of all guest nights were tourism results, the number of guests still realised in July and 14.9% in August. Expenditure of domestic overnight tourists without VFR and 290 397 336 371 +15.8% hobby (HUF million)* doubled, while the number of guest

Average expenditure of domestic overnight tourists per day nights was almost 85% higher. The tourism significance of Budapest 7746 4028 +13.9% without VFR and hobby (HUF)* and its results in 2019

Expenditure of outbound tourists (HUF million) 682 532 746 987 +9.4% 2019 is characterised by dynamic, 9.9% In addition to Hungary, Budapest is also growth in terms of accommodation more popular than ever. In line with the * Data calculated excluding the core motivations of VFR (Visiting Friends and Relatives) revenues (HUF 561.9 billion). nationwide trend, the performance of and hobby-type work. Source: KSH – Hungarian Central Statistical Office

+10.7% +13.2% Expenditure of Expenditure of inbound tourists domestic overnight tourists (HUF million) (HUF million)

10 11 Budapest’s tourism is growing steadily The gross accommodation fee revenue year after year. In Budapest, inbound tour- of commercial accommodation estab- ism continues to dominate, with almost lishments in Budapest in 2019 (HUF 90% of guest nights coming from foreign 171.4 billion) significantly exceeded 2018 guests. revenues – by 11.8% – and accommodation fee revenues almost tripled (+184.6%) In 2019, 5.7 million guests visited Bu- compared to 2010. dapest’s commercial and other busi- Párisi Passage, Budapest ness-type accommodation establish- In 2019, the most important feeder ments, spending almost 14.1 million guest markets to Budapest were the United nights. Compared to 2010, both the num- Kingdom, the United States of America ber of guests (+118.4%) and guest nights and Germany. A double-digit increase in (+125.7%) more than doubled. the number of guest nights was observed for Poland and Israel.

ARRIVALS AND GUEST NIGHTS IN ALL FORMS OF PAID ACCOMMODATION

2018 2019 2019/2018

DOMESTIC

Arrivals (000s) 8 186 8 488 +3.7% Guest nights (000s) 20 234 21 239 +5.0% +4.8% Average length of stay 2.5 2.5 +1.9% Number of international (nights) guests

INTERNATIONAL

Arrivals (000s) 7 318 7 668 +4.8%

Guest nights (000s) 20 162 20 794 +3.1%

Average length of stay 2.8 2.7 -1.6% (nights) TOTAL +3.7% Arrivals (000s) 15 504 16 156 +4.2% Number of domestic guests Guest nights (000s) 40 396 42 033 +4.1%

Average length of stay 2.6 2.6 +0.1% (nights)

Source: KSH – Hungarian Central Statistical Office

12 13 COMMERCIAL ACCOMMODATION GROSS REVENUES (million HUF)

2018 2019 2019/2018

International accommodation fees 186 206 208 744 +12.1%

Domestic accommodation fees 115 557 123 992 +7.3% Total accommodation fees 301 763 332 736 +10.3% +12.1% Food & drink 122 439 138 957 +13.5% International accomodation fee revenue Other revenue 87 138 90 210 +3.5%

Total revenue 511 340 561 904 +9.9%

Source: KSH – Hungarian Central Statistical Office

14 15 GUEST NIGHTS IN ALL FORMS OF PAID ACCOMMODATION The number of foreign guest nights significantly in the period since 2015. increased by 39%, while domestic guest Revenues from foreigners increased by

2015 2016 2017 2018 2019 2019/2015 nights showed a 31% growth compared 58.1% and revenues from residents by to 2015. 50.7%, while the total expansion is at Number of international guest nights 15 17 19 20 21 +39.0% (million nights) 55.3% compared to 2015. Number of domestic guest nights Accommodation fee revenues at (million nights) 16 17 19 20 21 +31.3% commercial accommodation estab- Guest nights total 31 34 38 40 42 +35.5% (million nights) lishments in Hungary have increased

Source: KSH – Hungarian Central Statistical Office

16 17 MOST POPULAR GUEST NIGHTS BY TYPE OF ACCOMMODATION TOTAL

ACCOMMODATION 2018 2019 2019 share 2019/2018 TYPES AND REGIONS Hotels 23 107 608 23 471 147 55.8% +1.6% Spa hotels 2 573 762 2 648 292 6.3% +2.9% In 2019, visitor numbers grew at a faster market appears to be saturated in this Pensions 2 288 046 2 336 034 5.6% +2.1% pace outside of Budapest than in the segment. The process can be tied to the capital city. The most popular types of spread of ‘sharing economy’ and short Community hostels 2 207 656 2 316 174 5.5% +4.9% accommodation were still higher quality term housing rental, which in 2020 is un- hotels, spa hotels, and other business-re- dergoing severe limitations by the Holiday houses 1 405 829 1 386 487 3.3% -1.4% lated accommodation establishments. Hungarian government. Camping sites 2 002 122 2 028 014 4.8% +1.3%

Domestic guests comprised 61.1% of spa On national scale, in terms of other Other profit oriented accomodation 9 385 017 10 495 145 24.7% +11.8% hotel guests and 51.4% of their guest accommodation establishments for nights were from domestic traffic. During business purposes, the ratio of domestic Total 40 396 278 42 033 001 100.0% +4.2% the period under review, the average guests was 53.6%, whilst that of domes- Source: KSH – Hungarian Central Statistical Office length of stay was 3.2 nights, exceeding tic guest nights was 51.9%. The average the average for commercial accommoda- length of stay in this accommodation tions. On average, foreign guests spent type was 3.1 and 3.3 days for domestic and 4 days, while domestic guests spent 2.7 foreign guests, respectively. days in spa hotels in Hungary. BUDAPEST Hungary’s capital with several Hungarian tourism is characterised by ge- World Heritage sites, a cosmo- SÁRVÁR politan atmosphere and vibrant According to HCSO data, in 2019 visitor ographical concentration. Regarding total earned the title of ‘healing place’ cultural life. Construction of over with its natural endowments. Be- 6,000 hotel rooms is currently numbers increased significantly not only guest traffic, Budapest and its region were sides its multi-generational spa, its underway in the capital. slow, cosy pace and the beautifully in commercial accommodation establish- in first place in 2019 in terms of guest traf- restored Nádasdy Castle make it ments, but also in other accommodation fic, with 42.1% of all tourists arriving here, an attractive tourist destination. establishments for business purposes. In while 38.9% of all commercial guest nights 2019, 3.2 million guests spent nearly 10.5 were generated here. Budapest is followed million guest nights in other accommo- by Lake Balaton, which accounted for a dation establishments. Compared to 2018, 14.8% slice of the overall national ‘pie’ in PÉCS HAJDÚSZOBOSZLÓ the number of guest nights in this type of terms of number of guests and 18.9% in conveys a Mediterranean lifestyle and is a is the best known spa town in popular university town. It captivates vis- the Great Hungarian Plain, its accommodation increased by more than terms of number of guest nights. itors with its charming streets, museums, main attraction being its spa medieval and Turkish monuments. It was complex, which is one of the one-tenth (by 12%). the European Capital of Culture in 2010 and largest and most versatile in For years, the first three places in terms its airport is scheduled for development. the country. Growth is outstanding in Budapest: the of guest traffic have been occupied by number of beds in other accommoda- Budapest, Hévíz and Hajdúszoboszló. Of HÉVÍZ’S main attraction is the hot tion establishments increased by 20.1% the twenty most popular settlements, the water medicinal lake unique in Europe. Further growth HARKÁNY in international visitor (44,885). At the same time, the number number of guest nights significantly in- is a small town on the numbers is expected due to southern border at the foot the development of nearby of guest nights spent at such establish- creased in Harkány (+20.9%), Pécs (+10.9%) of Tenkes Hill, which awaits Hévíz-Balaton Airport. guests with its pleasant ments increased by only 0.3%, thus the and Sárvár (+9.4%). Mediterranean climate, famous medicinal water, spa 18 and treatment hospital. 19 VISITOR NUMBERS AT COMMERCIAL ACCOMMODATION

Number of guests at Change in Number of guest nights at Change in commercial accommodation number of commercial accommodation number of guest establishments guests establishments nights

Area 2018 2019 2019/2018 2018 2019 2019/2018

Pest County 717 376 727 205 +1.4% 1 336 649 1 342 878 +0.5% BudapestPanorama

Central Transdanubia (Fejér, Komárom- 1 303 173 1 376 658 +5.6% 3 459 862 3 628 319 +4.9% Esztergom, Veszprém)

Western Transdanubia (Győr-Moson-Sopron, 1 942 451 2 016 091 +3.8% 5 748 672 5 729 282 -0.3% Vas, Zala)

Southern Transdanubia 1 062 424 1 093 975 +3.0% 2 809 198 2 841 984 +1.2% (Baranya, Somogy, Tolna)

Northern Hungary (Borsod-Abaúj-Zemplén, 1 192 583 1 214 319 +1.8% 2 713 857 2 721 040 +0.3% Heves, Nógrád)

Northern Great Plain (Hajdú-Bihar, Jász- 949 399 968 929 +2.1% 2 520 999 2 551 034 +1.2% Nagykun-Szolnok, Szabolcs-Szatmár-Bereg)

Southern Great Plain (Bács-Kiskun, Békés, 893 358 906 785 +1.5% 2 074 307 2 019 369 -2.6% Csongrád-Csanád)

Source: KSH – Hungarian Central Statistical Office

ARRIVALS AND GUEST NIGHTS IN COMMERCIAL ACCOMMODATION

+0.3% Number of arrivals Number of guest nights Northern Hungary

2019 2019 share 2019/2018 2019 2019 share 2019/2018 -0.3% Western Budapest (000s) 4 616 35.7% +2.9% 10 704 33.9% +3.4% Transdanubia +1.2% Northern +0.5% Great Plain Pest County Hungary without 8 304 64.3% +3.0% 20 834 66.1% +0.8% Budapest (000s) +4.9% Central Transdanubia Balaton 2 000 15.5% +1.9% 6 201 19.7% +0.5%

Total (000s) 12 920 +3.0% 31 538 +1.7% -2.6% Southern Source: KSH – Hungarian Central Statistical Office +1.2% Great Plain Southern Transdanubia

20 21 THE MOST POPULAR HUNGARIAN SETTLEMENTS, 2019 NUMBER AND CHANGE OF REGISTERED GUEST NIGHTS AT COMMERCIAL ACCOMODATION

Number Domestic International of guest 2019/2018 guest 2019/2018 2019/2018 guest nights nights Total nights

Budapest 10 703 950 +3.4% Budapest 1 233 754 -6.3% Budapest 9 470 196 +4.9%

Hévíz 1 144 141 +0.8% Hajdúszoboszló 611 026 -2.5% Hévíz 675 270 -2.3%

Hajdúszoboszló 979 995 -0.8% Zalakaros 508 137 +4.1% Bük 415 809 -4.1%

Balatonfüred 733 687 +0.6% Balatonfüred 478 124 +8.4% Hajdúszoboszló 368 969 +2.0%

Bük 722 757 -2.4% Hévíz 468 871 +5.5% Sárvár 308 248 +9.4%

Siófok 694 729 +5.2% Siófok 462 030 +5.1% Balatonfüred 255 563 -11.3%

Zalakaros 669 158 +5.0% Gyula 368 674 -3.6% Győr 240 155 +2.9%

Sárvár 533 253 +9.2% Eger 316 977 +0.5% Siófok 232 699 +5.4%

Győr 452 822 -4.9% Miskolc 314 161 -4.0% Zalakaros 161 021 +7.9%

Szeged 440 574 -0.8% Bük 306 948 -0.1% Debrecen 155 436 +7.3%

Eger 435 280 -1.3% Szeged 293 244 -1.3% Szeged 147 330 +0.1%

Gyula 427 055 -1.8% Debrecen 265 473 -3.6% Eger 118 303 -5.9%

Debrecen 420 909 +0.2% Sopron 262 811 -12.2% Vecsés 98 970 -11.2%

Miskolc 393 375 -2.9% Visegrád 229 916 -5.0% Hegykő 92 142 +2.9%

Sopron 345 125 -9.0% Sárvár 225 005 +8.9% Mosonmagyaróvár 89 248 +8.9%

Visegrád 265 449 -3.4% Győr 212 667 -12.4% Kecskemét 83 947 -18.8%

Pécs 264 108 +7.8% Pécs 199 356 +10.9% Sopron 82 314 +2.9%

Harkány 223 567 +20.9% Velence 194 950 +1.3% Miskolc 79 214 +1.9%

Nyíregyháza 212 692 +8.0% Zánka 191 692 +6.5% Székesfehérvár 75 056 +2.2%

Zánka 208 519 +13.3% Egerszalók 183 028 +3.2% Tihany 73 851 +4.5% Hajdúszoboszló

Source: KSH – Hungarian Central Statistical Office Source: KSH – Hungarian Central Statistical Office Source: KSH – Hungarian Central Statistical Office

+20.9% +10.9% +9.4% Harkány Pécs Sárvár 22 23 CHANGE IN MAIN FEEDER MARKETS

The number of commercial There has been no significant change accommodation guest nights in in the ten main feeder countries in 2019 shows that Germany is still the recent years, with Hungary’s key feeder largest feeder country in terms of markets remaining practically the visitor turnover. 626,000 visitors from same. An exception to this is that in Germany contributed more than 2019, Israel replaced Slovakia in the list 2 million guest nights to the tourism of top feeder countries. turnover recorded in Hungary, despite the continued downturn in German Turnover from countries other than the visitor numbers. At the same time, with TOP 10 markets also showed favourable the exception of Germany and Austria, trends. The growth was +9.4% from Hungary experienced an increase in Asia, of which 6.8% more guests from guest nights in terms of all ten of its China spent 7% more guest nights in main feeder markets in 2019. Hungary, 9.8% more arrived from India spending 8.8% more guest nights, and The largest increase was observed the number of guest nights from South for guest nights from Israel (+10.3%), Korea increased by 10.4% with Romania (+8.3%) and the United a stagnation in the number of guests. Kingdom (+4.9%), yet the expansion in visitor numbers is also visible in the case of guests from the Czech Republic (+3.5 %), Russia (+3.5%), the United States (+3.0%), Poland (+2.7%) and Italy (+0.1%). Danube, Liberty Bridge and the Citadel, Budapest 24 25 ARRIVALS AND GUEST NIGHTS AT COMMERCIAL ACCOMMODATION LISTED BY SOURCE COUNTRIES

Arrivals Guest nights Arrivals Guest nights

2019 2019/2018 2019 2019/2018 2019 2019/2018 2019 2019/2018

Austria 324 028 -1.7% 816 800 -3.8% Europe 4 658 871 +3.8% 12 399 994 +1.9%

Belgium 71 575 -5.2% 191 224 -7.9% from which: EU 3 433 544 +1.9% 9 136 160 -0.4%

Bulgaria 41 110 -0.4% 71 181 -4.1% Asia 910 229 +6.5% 1 911 870 +9.4%

Croatia 50 411 +3.9% 92 170 4.9% China 279 124 +6.8% 456 048 +7.0%

Czech Republic 331 582 +6.2% 978 822 +3.2% India 57 096 +9.8% 137 781 +8.8%

Denmark 55 911 -6.2% 190 281 -9.7% Israel 144 449 +10.0% 512 602 +11.8%

Estonia 9 626 +5.5% 21 538 +4.3% Japan 67 131 +1.3% 146 237 -3.9%

Finland 42 071 -12.1% 119 344 -13.5% Republic of Korea 175 342 -0.6% 279 445 +10.4%

France 180 968 +5.4% 474 664 +6.5% Africa 26 144 +9.8% 72 692 +8.1%

Germany 625 710 -1.7% 2 025 523 -3.3% America 511 123 -0.6% 1 215 327 +1.1%

Greece 56 058 +9.7% 147 606 +9.3% Brazil 26 067 -4.8% 69 453 +0.2%

Ireland 39 975 +13.6% 111 704 +15.1% Canada 49 382 -3.7% 121 261 -8.6%

Italy 255 392 31.7% 692 400 +0.5% United States of America 370 551 +0.7% 864 913 +3.3%

Latvia 8 960 -4.8% 22 598 +5.7% Australia and Oceania 62 209 -3.7% 152 690 -2.9%

Lithuania 11 821 +12.4% 25 366 +12.0% Australia 45 910 -9.0% 113 391 -6.9%

Luxembourg 4 626 +6.1% 11 189 +4.4% Total foreign 6 168 576 +3.8% 15 752 573 +2.7%

Netherlands 123 086 -4.5% 356 638 -9.3% Total domestic 6 751 671 +2.3% 15 785 283 +0.7%

Norway 47 033 -2.3% 139 425 -4.6% Source: KSH – Hungarian Central Statistical Office

Poland 301 322 +3.7% 781 414 +3.4%

Portugal 29 142 +13.8% 76 133 +13.4%

Romania 332 606 +9.3% 666 750 +9.3%

Russia 187 805 +5.2% 703 226 +3.4%

Serbia 70 748 -5.9% 143 666 -4.9%

Slovakia 220 503 +3.8% 496 677 +3.5%

Slovenia 37 010 +7.8% 70 527 +5.0%

Spain 189 410 +1.1% 491 789 +3.3%

Sweden 75 231 -6.0% 203 822 -9.3%

Switzerland 76 302 +5.6% 208 930 +2.5%

Turkey 60 913 -5.5% 131 663 -5.7%

Ukraine 217 299 +25.1% 420 005 +13.6%

United Kingdom 420 801 +4.6% 1 102 631 +5.4%

Source: KSH – Hungarian Central Statistical Office 26 27 CHANGES IN Hévíz DOMESTIC AND INBOUND TOURISM

In 2019, the number of domestic guests In 2019, guests spent a total of HUF 25.6 at accommodation establishments billion through SZÉP Cards in hotels increased by 4%, while the number outside the capital, which represents an of domestic guest nights grew by 5%. increase of 50.1% over the previous year. The length of stay also grew by 1.9%. Accommodation fee revenue from Based on the aggregation of service residents increased by 7.3% compared provider data, there was an inflow of to the previous year. HUF 190.6 billion to tourism and hospitality enterprises in 2019 due to the The use of the SZÉP Card in commercial SZÉP Card, a 74.2% increase compared accommodation establishments was to 2018 (HUF 109.4 billion) in terms of close to HUF 31 billion in 2019, which amounts paid with the Card. Most of represents a significant increase of this was spent from the hospitality 49.4% compared to the previous year. sub-account (HUF 141.3 billion; + 77.6%), As the purpose of the SZÉP Card is while spending from the accommoda- fundamentally to increase domestic tion sub-account amounted to demand, in accordance with Hungarian HUF 32.4 billion (+68.6%) and accommodation trends, SZÉP Card use HUF 16.9 billion (+59.0%) from the for hotels at the national level is almost leisure sub-account. fully (97%) realised outside of Budapest.

WHAT IS THE SZÉP CARD? The Széchenyi Recreation Card or SZÉP The SZÉP Card can be used to pay for Card is a universal, electronic voucher domestic holidays, hot meals, various in card format that the employee can healthcare, beauty care, wellness and receive from the employer as a fringe sports services, as well as cultural and benefit, within the cafeteria system. entertainment opportunities.

28 29 Although growth in terms of internation- MOTIVATION OF al tourist arrivals was more modest than INTERNATIONAL TOURISTS before, it was still above the European Expenditures of 1-3 nights 4+ nights Period of time average. In 2019, 6.1% more guests spent visitors (million HUF) 4.4% more guest nights in Hungary. City break and tours +44.1% +39.8% 2010. year 828 041

In terms of accommodation types, VFR +24.2% +19.4% 2015. year 1 235 096 hotels were by far the most popular, Business trip +9.9% +3.6% 2019. year 1 745 265 particularly spa and wellness hotels, Holiday, leisure, +9.4% +22.7% Source: KSH – Hungarian Central Statistical Office but the largest expansion was achieved recreation by community hostels (+17.1%) and other Spending time in +5.5% +5.7% business type accommodation estab- own property +110.8% +41.3% lishments (9.9%). Health tourism +5.1% +7.8%

Cultural or sport 2019 / 2010 2019 / 2015 +1.8% +0.9% City visits were the most prominent events Expenditures of visitors in terms of motivation, yet many also Source: KSH – Hungarian Central Statistical Office come for recreational purposes.

30 31 ACCOMMODATION CAPACITY

The increase in the revenues of com- In 2019, the economic performance Units Rooms Beds 2019/2018 mercial accommodations exceeded the indicators of hotels also showed a Hotels 1 051 61 696 149 317 +0.3% pace at which visitor numbers grew in significant increase. While the average Spa hotels 39 5 650 13 031 +0.7% 2019, as well. 2019 is characterised by room rate was HUF 20,794 in 2018, one Pensions 1 273 13 317 34 773 +0.1% dynamic, 9.9% growth in terms of year later this amounted to HUF 22,474 Community hostels 478 15 246 52 027 -2.8% accommodation revenues (HUF 561.9 with an increase of 8.1%, while over the Holiday homes 441 7 677 24 870 -3.7% billion). The growth rate of revenues past five years the average room rate Camping sites 232 1 549 88 894 -1.6% from accommodation fees (HUF 332.7 at hotels increased by a total of HUF Other profit oriented accomodation 44 367 117 733 274 153 +6.1% billion), which accounts for the largest 5,000. The room occupancy rate is also Total 47 842 217 218 624 034 +2.0% share of total revenue, is 10.3%. Com- rising year by year, with the 53.9% rate Source: KSH – Hungarian Central Statistical Office pared to the results from 2010, the of capacity utilisation in 2015 reaching accommodation fee earnings of accom- 61.5% by 2019. modation establishments increased by 250%, which also shows the dynamic expansion of tourism.

COMMERCIAL ACCOMMODATION ROOM OCCUPANCY RATE (%)

2019

Hotels 61.5

Spa hotels 68.8

Pensions 33.2

Community hostels 26.0

Holiday homes 31.6

Camping sites 23.3

Average 51.4

Source: KSH – Hungarian Central Statistical Office

32 33 MAIN FEATURES OF MEETINGS INDUSTRY INTERNATIONAL CONFERENCES ORGANISED IN HUNGARY 2019

KEY DATA Number of conferences 1867

Average number of 172 BUDAPEST IN participants The data of Budapest Convention In 2019, Budapest ranked 26th in the THE 2019 ICCA RANKINGS Average duration 3.5 days Bureau show that in 2019, the number ICCA (International Congress and (NUMBER OF CONFERENCES; RANK) 73.2% Budapest, Territorial distribution of MICE events increased by 10.6% Convention Association) international rest of country 26.8% Total number of interna- compared to 2018. A total of 5,324 conference venue rankings, overtaking Ranking tional conferences (above 18.5% trade, 13.2% healthcare, X hundreds participants)* 9.7% scientific, 9.4% IT & Most popular topics MICE events were held, of which 3,457 major congress venues such as telecom, 7.0% industry, 4.8% agriculture conferences were associated with Shanghai (27th), Brussels (28th), 2009 13 92 Hungarian and 1,867 with international Helsinki (29th) and Edinburgh (31st). 2010 18 87 66.1% hotel, 11.1% university, Most popular 9.1% convention centre, 2011 (EU) 11 108 conference venues clients. There was an exceptional, 28.3% Budapest finished in 15th place in the 13.7% other venues* increase in the number of international ranking of European cities. 2012 20 98

MICE events in 2019 compared to the 2013 17 106 British 17.2%, US 15.8%, German 14.1%, French 8.5%, Spanish 8.1%, Italian 4.2%, previous year. In 2019, over 2.7 million foreign 2014 17 97 Nationality of clients Austrian 3.8%, Belgian 3.2%, corporate travellers arrived in Hungary 2015 19 95 Czech 2.5%, Swiss 2.3%, other 20.3% The number of participants was (whose travel motivation was to attend 2016 16 108 exceptionally high, a total of 894,432 conferences, congresses, exhibitions Source: Budapest Convention Bureau 2017 12 128 **Other venues include cultural and community centres, guests participated in MICE events or fairs, as well as business trips) and research institutions, medical clinics, museums, offices 2018 20 100 and chambers of commerce. in Hungary in 2019, which was an who spent nearly 6 million days in the International conferences: corporate or association events of at 2019 26 90 least 50 people, attended by foreign guests. Data reporting is even more dynamic increase than the country. Their travel spending related to not mandatory and as such the results are based solely on Source: International Congress and Convention Association data voluntarily provided by data reporting partners. number of events, growing by a total of their stay in Hungary amounted to HUF Considered an international conference if it has at least one *A conference or congress where the end customer is an associ- international participant. ation, its organiser is an organisation with a scientific founda- 12.5% compared to the total number of 211.3 billion (source: KSH – Hungarian tion that is recognized by ICCA, it rotates annually between at least 3 countries, occurs regularly, and attracts a minimum of participants in 2018. Central Statistical Office). 50 participants arriving from at least 3 different countries.

As in previous years, the TOP 3 clients CONFERENCES ORGANISED IN HUNGARY 2019 of international conferences remained the British (17.2%), the Americans (15.8%) Number Distribution and the Germans (14.1%), yet Hungary International Hungarian International Hungarian was also a popular MICE destination for Corporate 1040 2015 55.7% 58.3%

French (8.5%), Spanish (8.1%) and Italian Association 652 918 34.9% 26.6%

(4.2%) customers. Other* 175 524 9.4% 15.1%

Total 1867 3457 100.0% 100.0%

Source: Budapest Convention Bureau * Other categories include events organised by the state, a church or a foundation, scientific events organised by universities, as well as events not otherwise specified by the service providers for reasons of trade secrets, and/or events that are inaccurately named.

34 35 COMPETITOR ANALYSIS HUNGARY, CZECH REPUBLIC AND AUSTRIA TOURISM INDICATORS IN 2019 Hungary Czech Republic Austria

Comparison of the results of Hungary, Hotel performance indicators Value 2019/2018 Value 2019/2018 Value 2019/2018 the Czech Republic and Austria Of the three countries, Hungary achieved In a review of the visitor numbers of the best results in 2019 in terms of room Number of guests 16 156 122 +4.2% 21 998 366 +3.5% 46 004 692 +2.6% commercial and other accommodation occupancy. The differences between the Foreign guests 7 668 023 +4.8% 10 890 500 +2.6% 31 735 190 +3.0% establishments in 2019, 16.2 million guests countries are not significant when examin- spent a total of 42 million guest nights in ing room capacity occupancy, yet this rate Domestic guests 8 488 099 +3.7% 11 107 866 +4.4% 14 269 502 +1.7% Hungary. Compared to the 2018 results, was 1.5% higher in Hungary than in Austria. Number of guest nights 42 033 001 +4.1% 57 024 767 +2.7% 151 890 173 +1.4% the change in the number of guests was Nevertheless, the occupancy shows no 4.2% and the number of guest nights significant change in Hungary compared Foreign guest nights 20 794 112 +3.1% 27 180 563 +1.6% 112 067 635 +1.5% grew by 4.1% in one year. In the case of to the same period of the previous year Domestic guest nights 21 238 889 +5.0% 29 844 204 +3.8% 39 822 538 +1.1% Budapest, the number of guests reached (-0.4 percentage points), but in Austria the

5.7 million with a 4.3% growth, while the growth rate was 0.9 percentage points and Occupancy rate* 78.0% -0.4%p 75.30% +1.6%p 76.50% +0.9%p number of guest nights was 14.1 million, 1.6 percentage points in the Czech Republic. Average price (EUR)* 88.1 +5.0% 85.6 +2.1% 110.7 +6.6% showing an increase of 2.7% over 2018.

In 2019, the average price in Austria RevPAR (EUR)* 68.7 +4.5% 64.5 +3.8% 84.7 +7.6% Austrian accommodation establishments increased by 6.6% at EUR 110.7. In Hungary * Hotel results registered 46 million guests (+2.6%) and (EUR 88.1) and in the Czech Republic (EUR Source: KSH – Hungarian Central Statistical Office, Czech Statistical Office, Statistics Austria 151.9 million guest nights (+1.4%) in 2019. 85.6), this amount is lower and the growth In Austria, inbound demand is dominant, rate of change is also less dynamic com- with 70% of visitor numbers coming from pared to the previous year, however, the BUDAPEST, PRAGUE AND VIENNA TOURISM INDICATORS IN 2019 abroad. In Vienna, the number of guests net average room rate of hotels in Hungary was 7.9 million (+4.9%), who spent increased by 5%, while this value was only Budapest Prague Vienna 17.5 million guest nights (+6.2%) in the 2.1% in the Czech Republic. Value 2019/2018 Value 2019/2018 Value 2019/2018 Austrian capital. Compared to the nationwide results, Vienna experienced a more Revenue per available room (RevPAR) Number of guests 5 694 027 +4.3% 8 044 324 +1.9% 7 912 139 +4.9% dynamic growth rate in terms of visitor was similar to the ADR value, reaching Foreign guests 4 954 423 +5.6% 6 803 741 +2.0% 6 249 159 +6.1% numbers. EUR 84.7 in Austria after a 7.6% increase,

EUR 68.7 (+4.5%) in Hungary and EUR 64.5 Domestic guests 739 604 -3.9% 1 240 583 +1.6% 1 662 980 +0.9% Upon reviewing the visitor number data (+3.8%) in the Czech Republic. of the Czech Republic, we find that the Number of guest nights 14 055 480 +2.7% 18 479 653 +1.3% 17 499 328 +6.2% number of guests increased by 3.5% at 22 In Vienna, room occupancy increased Foreign guest nights 12 587 799 +3.7% 16 37 962 +1.5% 14 446 582 +7.1% million, and the number of guest nights above the national average in 2019 as well, amounted to 57 million, an increase of but the net average room rate and the Domestic guest nights 1 467 681 -5.6% 2 107 691 -0.4% 3 052 746 +1.9%

2.7% compared to 2018. In 2019, 32% of the net RevPAR showed even more dynamic Occupancy rate* 78.30% -0.8%p 79.30% +0.8%p 78.60% +1.1%p total number of guest nights in the Czech growth. The results show that the values Republic was realised in Prague, howev- of Prague’s performance indicators Average price (EUR)* 91 +5.1% 93.3 +2.9% 109.3 +7.4% er, visitor numbers showed less dynamic exceed those of Budapest, albeit only RevPAR (EUR)* 71.2 +4.3% 74 +3.7% 85.9 +8.6% growth in the capital compared to slightly; however, it is encouraging that national results. the Hungarian capital experienced a more * Hotel results Source: KSH – Hungarian Central Statistical Office, Czech Statistical Office, Statistics Austria dynamic growth rate in January-Decem- ber in terms of both the average price and the RevPAR indicators.

36 37 WHAT CHARACTERISES 2020?

The data for the first two months during the three summer months, in As of April, the Hungarian Tourism the issue of coronavirus exposure, of 2020 gave rise to optimism, particular, July and August yielded great Agency has been regularly measuring i.e. the safety factor (32%). showing incredible monthly growth results in domestic visitor numbers. willingness to travel and its changes rates at the beginning of the year. The number of domestic guests is 18% among the Hungarian population. The There is a need for innovative, proactive This favourable upward trend was higher and the number of guest nights results show that individual financial thinking and innovative solutions on reversed in mid-March by the almost they spend is about 20% higher than in situation is a decisive factor in terms the part of service providers and state complete shutdown due to the the summer of 2019. of destination choice (65%). Apart governance alike, through which the coronavirus situation, which hit tourism, from price, the experience that the country, the tourism industry and its accommodation and hospitality services The numbers may be considered destination promises is also a key factor employees can adapt to the changed extremely hard in the spring months. particularly good given the spring (49%). The third most important factor is circumstances. shutdown and the slow start to the Thanks to swift and coordinated summer season. The growing attraction governmental action, in late May/ and prestige of domestic holidays, early June the 2020 domestic tourism continuous improvements, HTA season picked up after the restrictions campaigns, favourable weather and were lifted. The last two months of the increased SZÉP Card benefits greatly summer show particularly good results contributed to this outcome. in terms of domestic turnover, and in many places the turnover of Hungarian Naturally, inbound international guests even exceeds the levels seen in travellers are still sorely missed and the the same period last year. resurgence of this field is still proving to Fertőd palace, Esterhazy be slower. This summer, most inbound According to the National Tourism Data tourists arrived to Hungary from Supply Centre, the first eight months Germany, Poland, Slovakia, the Czech of 2020 were concluded with a total of Republic, Austria and Romania. approximately 5.7 million guests and nearly 16 million guest nights. This is less Among the key regions, Lake Balaton than the same time last year (overall, was by far the most popular in the domestic and foreign turnover fell by summer, with nearly 1.3 million guests 27% and 69%, respectively). At the same and over 4 million guest nights. This time, it is important to highlight that means that 40% of all the national 3.5 million of these guests and about summer visitor numbers are tied to 10.3 million guest nights were realised Lake Balaton.