Greece’s tourism boom faces growing risks from climate change and overtourism, the Bank of Greece warned in its Monetary Policy 2025-2026 report, stressing that both challenges could weaken the sector’s long-term sustainability.
The central bank also cautioned that Greece’s strong dependence on tourism makes the wider economy more vulnerable to external shocks. Tourism remains one of the country’s most important economic drivers, but the report argues that continued growth now requires better planning, stronger infrastructure, and a more sustainable development model.
Climate change is reshaping tourism demand
The Bank of Greece says the country is among the tourism-dependent economies expected to face strong pressure from climate change. The country’s developed tourism infrastructure and existing policy framework may help reduce part of the impact, but they cannot eliminate the risk.
The report highlights the way climate change affects Greece through extreme heat, prolonged heatwaves, and severe weather events such as storms Ianos and Daniel. These conditions can influence both demand and supply. They can affect when travelers choose to visit, where they go, and how smoothly destinations can operate under pressure.
For that reason, the Bank of Greece says tourism policy must incorporate climate risks into long-term planning. The issue no longer concerns only environmental protection. It now affects investment decisions, infrastructure, water and energy management, and the ability of destinations to remain attractive in a warmer and less predictable climate.
Greece needs a more balanced tourism model
The Bank of Greece says Greece needs a more sustainable tourism model built around four main priorities: reducing seasonality, spreading tourism activity more evenly across the country, developing alternative forms of tourism, and improving the environmental management of tourism-related activities.
This shift would require stronger investment in infrastructure, more green investment, and more rational use of natural resources. Water and energy require particular attention in destinations that face intense seasonal pressure, especially during the summer months.
The goal, according to the report, should be to strengthen the resilience of Greek tourism while protecting its long-term competitiveness. In practical terms, Greece needs to move beyond a model that relies heavily on a limited number of destinations and a short peak season.
Overtourism strains destinations and local communities
The Bank of Greece also warns that overtourism places significant pressure on both natural and urban environments. The report stresses that overtourism does not depend only on the number of visitors. It also reflects geographic, seasonal, and management imbalances.
Tourism has expanded rapidly in recent decades, bringing major economic benefits to Greece but also creating pressure points in popular destinations. Similar patterns appear internationally in cities, islands, historic centers, and coastal areas where visitor flows exceed the capacity of local infrastructure and communities.
The central bank identifies several drivers behind overtourism, including the global rise in tourism demand, low-cost airlines, digital booking platforms, and higher disposable income in many parts of the world. Affordable air travel and cruise tourism have also made short, high-volume visits easier and more frequent.
Environmental, social, and economic costs are rising
Overtourism affects destinations across several fronts. High visitor volumes contribute to pollution, increased waste, ecosystem degradation, and excessive use of scarce resources such as water and energy.
In urban destinations, overtourism accelerates the wear and tear of public infrastructure and cultural heritage assets. It can also change the character of neighborhoods, weaken local identity, and make daily life harder for permanent residents.
Residents in highly visited areas often face overcrowding, rising housing costs, the loss of local services, and weaker social cohesion. These pressures create tension between the economic benefits of tourism and the everyday needs of local communities.
The Bank of Greece also warns that overtourism can eventually reduce the economic returns of tourism itself. Congestion and a lower-quality visitor experience can damage the competitiveness of destinations over time. In that sense, overtourism can undermine the economic sustainability of places that rely heavily on tourism income and jobs.
Bank of Greece calls for better monitoring of tourism risks
To address these pressures, the Bank of Greece says policymakers should focus on better monitoring of tourism indicators and a more effective distribution of visitor flows across both geography and time.
The report calls for measures that ease pressure on the most popular destinations, strengthen environmental sustainability, and improve infrastructure. It also highlights the need to train tourism professionals and raise visitor awareness about the protection of historic monuments and respect for the quality of life of permanent residents.
