U.S. Set to Lose $20 Billion as Foreign Tourism Declines Amid Trade Tensions and Trump Policies

The United States economy is bracing for a major financial setback, with international tourism in sharp decline due to escalating trade disputes and controversial policies introduced under President Donald Trump. Analysts estimate that the drop in foreign visitors could cost the U.S. around $20 billion in retail revenue this year alone.

Figures from the International Trade Administration (ITA) show that international travelers spent a record $254 billion in the U.S. last year. The agency initially projected 77 million international visitors for the current year. However, those numbers took a hit following intensified immigration crackdowns, ongoing trade conflicts, and aggressive foreign policy statements from the Trump administration. By the end of March, arrivals of non-U.S. citizens had dropped nearly 10% compared to the same time last year.

Bloomberg Intelligence reports that the downturn is already visible, with declines in airline tickets, hotel prices, and car rental fees noted in March. Economists from Goldman Sachs and HSBC suggest that reduced demand from overseas visitors may be a key contributor. Goldman Sachs warns that in a worst-case scenario, the economic impact could amount to 0.3% of the nation’s GDP—translating to nearly $90 billion in losses.

Why Are Tourists Steering Clear of the U.S.?

Recent incidents involving harsh treatment of visitors, abrupt visa cancellations, and prolonged detentions at U.S. entry points have drawn global concern. Several European countries, including the UK and Germany, have updated travel advisories, cautioning citizens about potential issues at the U.S. border. Dozens of European tourists have reportedly been denied entry, with some detained for weeks despite holding valid documents.

Compounding the issue are President Trump’s controversial remarks targeting various nations. Since beginning his second term, Trump has made provocative claims about annexing Canada, Greenland, Mexico, and even the Panama Canal. He’s also suggested interfering in Venezuela, the Gaza Strip, and religious institutions like the Catholic Church. These statements have sparked international outrage and calls for boycotts.

A YouGov survey revealed that two-thirds of Canadians now view the U.S. as either “unfriendly” or “an enemy.” Over 60% of Canadian respondents admitted to actively avoiding American brands. Statistics Canada reports a 32% drop in road trips to the U.S. by Canadians for the third straight month. In addition, OAG Aviation Worldwide found that flight bookings from Canada to the U.S. had plummeted 70% through September compared to the previous year.

This decline isn’t confined to North America. The U.S. Travel Association warned earlier that even a 10% drop in Canadian tourism could cost $2.1 billion and put up to 140,000 hospitality jobs at risk. Meanwhile, the National Travel and Tourism Office recorded a 17% decrease in visitors from Western Europe in March. Hotel chain Accor SA also reported that summer bookings by Europeans in the U.S. are down by 25%.

The combination of unfriendly immigration policies, diplomatic strain, and controversial rhetoric appears to be driving away tourists — and with them, billions in potential revenue.