Caribbean tourism investors take disruption in stride as confidence holds steady and capital continues to flow into region

• 75% of investors expect only limited geopolitical fallout, underscoring the Caribbean’s safe-haven appeal
• More than 70% of banks expect AI to materially impact parts of the Caribbean tourism industry
• All-inclusive resorts evolve and expand, with 71% of banks reporting rising deal activity — a record high

The Caribbean tourism financing community is demonstrating quiet confidence in the face of ongoing global disruption, according to the latest findings from Baker Tilly’s 2026 Caribbean Hospitality Financing Survey.

While geopolitical tensions, shifting inflation expectations and rapid technological change continue to shape the global landscape, investor sentiment across the region remains measured and resilient.

Having navigated economic crises, pandemics and repeated natural disasters over the past two decades, the industry is showing a familiar pattern, absorbing shocks, adapting quickly, and maintaining focus on long-term fundamentals rather than short-term volatility.

Gary Brough, managing director, Baker Tilly (Turks and Caicos), commented: “After everything the Caribbean tourism industry has experienced over the past two decades, there is a strong sense of perspective among investors and financiers.

“Geopolitical events, inflationary pressures and technological change are clearly important, but they represent the latest of many disruptive challenges faced and previously overcome by this most resilient of industries. Rather than overreacting, stakeholders tend to take a pragmatic view, adapt where necessary, and continue moving forward. There is very much a ‘here we go again’ mindset.”

Confidence levels reflect this steady approach. Banks’ confidence has edged up to 6.71 out of 10, from 6.60 last year, while non-bank investors (private equity, family offices, etc) remain more confident overall at 7.54, albeit down from 8.10 in 2025. Both groups remain close to their 10-year averages, pointing to a market that is stable rather than overheated.

Underlying market fundamentals continue to provide a strong foundation for this sentiment. The Caribbean remains the most tourism-dependent region globally, with 7 of the world’s top 10 most tourism-dependent countries located in the region, according to the World Travel & Tourism Council, and long-term growth projections remaining robust. Tourism’s contribution to regional GDP is expected to grow steadily, reaching US$111.5 billion by 2035, up from US$81.4 billion in 2024, while supporting approximately 3.6 million jobs.

Limited fallout from geopolitical events

Recent geopolitical developments have heightened awareness of external risk, particularly following flight disruptions linked to regional tensions earlier in 2026. However, the majority of investors expect any impact to be contained, with 75% of respondents stating that while some travellers may delay vacations, the overall effect will be small.

Similarly, inflation expectations have shifted, with 57% of banks and 54% of non-banks now expecting inflation to rise over the next 12 months, compared to a majority expecting stability last year. However, sentiment remained broadly consistent even during periods of heightened geopolitical tension, reinforcing the industry’s tendency to take a longer-term view.

AI enters the investment conversation

The increasing role of artificial intelligence (AI) is also shaping investor perceptions, with 71% of banks expecting AI to have a significant impact on certain aspects of the industry, particularly in marketing and business development, while non-bank views remain more varied. Despite this, the sector continues to view AI as an enabler rather than a disruptor, with the human element remaining central to the tourism experience.

Activity across the sector remains underpinned by strong structural demand. Investment in all-inclusive resorts continues to grow, with 71% of banks reporting increased engagement in all-inclusive transactions, a record high. At the same time, financing appetite is strongest for existing assets, with around 70% of both banks and non-banks prioritising refinancing, expansion and renovation opportunities.

Capital keeps flowing into the region

Despite some operational challenges, capital allocation to the region remains robust. Banks are increasing exposure to the sector, with Caribbean lending rising to 38% of total lending portfolios, up from 31% last year, while non-bank allocation has reached 68%, up from 63%.

Brough concluded: “The fundamentals remain compelling. Demand is resilient, capital continues to flow into the region, and the long-term growth story continues. What we are seeing is not hesitation, but a more disciplined and mature investment approach.”