It’s not the cheeriest headline, but it’s worth paying attention to.
According to the latest BBVA Research forecasts, the Canary Islands are expected to drop from Spain’s fastest-growing region to the slowest by 2027. Quite a swing, especially given how strong things look right now.
At the end of 2025, the islands were sitting pretty, with economic growth of around 3.5%, the highest in Spain. Tourism is booming, spending is up, and on the surface at least, everything looks rosy.
But BBVA reckons the next few years will look a bit different.
From boom to slowdown
The forecast suggests growth will ease back to around 2.3% in 2026, before slowing further to roughly 1.6% in 2027. By that point, the Canary Islands, along with the Balearics, are expected to be at the bottom of Spain’s growth rankings.
The main reason? Foreign tourist spending.
Not visitor numbers as such, but how much people are actually spending once they arrive. BBVA expects this to “moderate”, which is economist-speak for people still coming, but tightening their belts a little.
Germany plays a big part here. It’s one of the Canary Islands’ key tourism markets, and with the German economy slowing, that knock-on effect is already being factored in. Add global uncertainty and geopolitical tensions into the mix, and the picture becomes clearer.
Tourism numbers still strong
None of this means tourism is falling off a cliff.
In fact, pending final figures for December, the Canary Islands welcomed around 16.7 million visitors last year, up 4% on the previous year. Regional authorities suggest the final total could be closer to 18.4 million.
Across Spain as a whole, foreign tourism hit another record, with around 97 million international visitors, a 3.5% increase year on year.
Spending has risen too. National tourist spending reached approximately €135 billion, up nearly 7%. In the Canary Islands, visitor spending hit just over €22 billion, a 7.6% annual increase.
Strong numbers by any measure.
So what’s really going on?
Simple answer… growth doesn’t accelerate forever.
The Canary Islands economy is heavily dependent on tourism, so even a slight easing in spending growth makes a noticeable difference to the overall figures. After several years of outperforming the rest of Spain, a cooling-off period was always likely.
BBVA also points out that this isn’t just a Canary Islands story. By 2027, Spain’s overall GDP growth is expected to settle around 2%, driven by weaker consumption and a less dynamic tourism sector.
Regions with stronger industrial and export bases are expected to fare better. Areas like Aragon and Navarre are forecast to lead national growth, with rates of around 2.5%, helped by housing investment, exports, and industrial recovery.
Not a crisis, just a correction
Despite the gloomy headline, this isn’t a Canary Islands collapse.
It’s more a case of moving from exceptional growth to more normal levels. The islands aren’t suddenly doing badly, they’re just no longer expected to lead the pack.
Anyone surprised by that probably hasn’t been watching how heavily the local economy leans on tourism.
More on what this means for Tenerife property, prices, and long-term demand soon.
