A new report from the Organisation for Economic Co-operation and Development (OECD) shows international tourist arrivals in OECD countries rose by an estimated 3.4 per cent in 2025 to reach a record 847 million, building on strong growth of 8.1 per cent in 2024.
However, as geopolitical tensions, shifting traveller behaviour and extreme weather-related events continue to shape the tourism landscape, OECD said destinations will need to strengthen their ability to anticipate and adapt to uncertainty.
The OECD Tourism Trends and Policies 2026 report shows the conflict in the Middle East has disrupted global travel flows and increased costs, which is weighing on traveller confidence. Countries in the region are most impacted, along with destinations reliant on the Gulf for air connectivity. OECD said these effects are likely to persist in the near term.
"Tourism continues to grow, generating business opportunities, jobs and tax revenues across the OECD,” OECD Secretary-General Mathias Cormann said.
“Governments and businesses need to work together to sustain this growth and build resilience. This means applying the lessons of the pandemic and the conflict in the Middle East to strengthen crisis preparedness, and managing tourism and visitor flows to ensure the sector delivers lasting benefits.”
According to OECD, concerns about safety, affordability and cancellations may influence travel decisions, leading travellers to favour more familiar and affordable destinations, shorter stays and lower-cost options.
As airlines, tour operators and other tourism providers adjust their programs for 2027 and beyond, OECD said destinations will need to anticipate changing travel patterns and adapt their strategies to evolving geopolitical, economic and weather-related risks.
The report said governments are increasingly rethinking tourism development and management, adopting more strategic approaches to balance economic, social and environmental outcomes while strengthening competitiveness and resilience.
“Tourism success is increasingly defined by the sector’s ability to generate sustained economic value through enhanced resilience, environmental sustainability and positive outcomes for local communities,” OECD said.
"Strategic approaches to manage tourism, supported by governance frameworks designed to improve co-ordination across policy areas and between levels of government are increasingly being adopted, alongside an emphasis on environmental stewardship, community engagement and visitor management.
“Digitalisation and advances in artificial intelligence are creating new opportunities to improve tourism management, boost operational efficiency and deliver more personalised experiences.
“At the same time, governments are strengthening tourism data systems and digital tools to provide more timely, granular and reliable data, making data-driven approaches increasingly central to policy design and implementation.”
According to OECD, translating these strategic shifts into practice requires a stronger enabling environment for tourism businesses.
This includes streamlining regulation, improving access to finance, investing in skills and supporting digital and sustainable transitions. Reliable transport systems remain essential to improving connectivity and the visitor experience, while improving accessibility and participation can deliver wide-reaching benefits for regions and communities.
Against this backdrop, OECD said more co-ordinated, flexible and whole-of-government policy approaches are needed to navigate uncertainty, address structural imbalances, harness digital and AI opportunities, accelerate environmental action, and share tourism benefits more widely.
"Building a more competitive and resilient tourism sector will require targeted investment and stronger policy alignment to support SMEs, modernise infrastructure, improve connectivity and deliver more sustainable outcomes," OECD said.
The outlook for tourism
Looking ahead, OECD said short-term challenges were impacting tourism, although demand is expected to remain strong over the longer run.
"The outlook remains uncertain as tourism navigates a complex and dynamic risk environment, influenced by evolving geopolitical developments, including in the Middle East, as well as broader pressures on the sector," OECD said.
"Over the longer term, while there is growing policy momentum to manage tourism more sustainably, a key challenge will be to keep pace with fast-evolving technological development.
“Advances in digital tools and Artificial Intelligence are already reshaping tourism systems, business models and visitor behaviour, requiring continued adaptation across the sector."
In a recent OECD survey, one third of OECD countries expect tourism performance to exceed 2025 levels by the end of this year, with many breaking new records.
Around half of responding countries report tourism performance moderately above 2025 levels, and more than three quarters expect tourism performance to exceed 2025 levels by the end of 2026.
Performance was in line with expectations at the start of 2026 for around half of countries. While high costs and geopolitical factors are key constraints, some destinations reported benefitting from shifts towards closer, more accessible and perceived safer locations.
OECD said demand remains broadly resilient, though economic and geopolitical factors are influencing traveller behaviour, particularly on where and when to travel.
Destination reputation, particularly in terms of safety, continues to play an important role in sustaining consumer confidence. Looking ahead, the main risks for 2026 are geopolitical instability (80 per cent of respondents), persistent price pressures (75 per cent), connectivity disruptions (45 per cent) and economic slowdown in source markets (40 per cent). Meanwhile, sentiment for 2027 remained positive overall.
Experiences key to future growth
Evolving travel preferences among younger generations are expected to further shape tourism demand and drive diversification of products.
According to the OECD report, by 2030, Millennials and Generation Z are projected to account for more than half of global travellers, with spending patterns increasingly oriented towards experiences rather than goods.
OECD said this shift was creating opportunities in experience-based segments such as cultural and music events, and sports tourism, with the latter estimated to have generated $US609 billion globally in 2023 and expected to grow by 16 per cent annually from 2024 to 2030.
"While these trends offer significant potential to enhance value creation and extend tourism benefits, they also reinforce the need for destinations to
adapt offerings and manage impacts to ensure long-term sustainability," OECD said.
View the full report here.
