Mexico's main beach destinations, including the world-renowned resort city of Cancun, are struggling with a decline in foreign visitors.
Tourist Numbers Fall Even Ahead of the World Cup
International passenger traffic at Cancun International Airport fell about 12% in September from a year earlier, the Financial Times reported on the 11th. The number of foreign visitors entering Mexico through airports in the January-August period dropped 1.9% from the same period last year, while American visitors fell 5.8%.
Mexican government data also confirmed the slump at major beach destinations. Puerto Vallarta, San Jose del Cabo and Cancun were among the resorts hit by the decline. Mexico had initially expected tourism demand to rise as a co-host of this year's World Cup in North and Central America, but the event has yet to deliver clear results.
The tourism slump is expected to add to pressure on the Mexican economy. Tourism accounted for more than 8% of Mexico's gross domestic product as of 2024, making it a key industry. With the economy stuck in low growth, the hit from fewer visitors is all the heavier.
Mexico's economy grew just 0.6% last year, and the International Monetary Fund projects growth of only 1.2% this year. The FT said the downturn is adding pressure on President Claudia Sheinbaum, who inherited Mexico's largest fiscal deficit since the 1980s.
Costlier Travel, Foul Odors and Crime
Behind the drop in visitors is the strength of the Mexican peso. With interest rates held above U.S. levels and the dollar weakening since the Trump administration took office, the peso has gained about 12% over the past 18 months. For foreign travelers, that has meant higher costs for lodging, meals and sightseeing.
Beach conditions are another drag. Rising sea surface temperatures linked to climate change have fueled growth of sargassum, a brown seaweed whose accumulation along the shoreline spreads a foul odor and damages the sand and ocean views.
Security is also seen as an obstacle to a tourism recovery. Arrivals at Tulum International Airport on Mexico's Caribbean coast plunged more than 40% this year, after reports that cartel groups had moved in to prey on visitors drawn by electronic dance music festivals and parties.
Puerto Vallarta, on the western coast, has not escaped the damage either. Roads in the city were blocked off in February after Mexican forces killed Nemesio Oseguera, the leader of the Jalisco New Generation Cartel (CJNG). Video of the grisly scene spread overseas, deepening unease, analysts said.
The FT said the peso has begun to weaken as the U.S. Federal Reserve raises interest rates, but that winning back the lost tourists will not be easy.