By: Andrew Carlson

New York City is bracing for a significant economic hit in 2025, with officials projecting a $4 billion decline in foreign tourism spending, driven by a steep drop in international visitors. According to a recent forecast released by NYC Tourism + Conventions and reported by VIN News, the number of foreign tourists is expected to fall by 2 million people, representing a 14% decrease from prior estimates.

Although international tourists make up only 20% of all visitors, they are responsible for nearly 50% of total visitor spending, underscoring their outsized economic impact on the city. “This downward revision represents an estimated loss of over $4 billion in direct spending,” said Julie Coker, President and CEO of NYC Tourism + Conventions, as quoted by VIN News.

The news has sent shockwaves across the city’s tourism-dependent industries — from horse-drawn carriage rides in Central Park to Midtown’s high-volume restaurants and souvenir shops — many of which are already reporting sharp declines in international foot traffic.

Industry insiders and business owners say the downturn is more than just a post-pandemic fluctuation — it reflects a broader shift in international sentiment toward the United States, exacerbated by political tensions and trade policies.

Matt Levy, the founder of Spread Love Tours, told VIN News that his business has seen an 85% drop in Canadian revenue this year alone, a dramatic downturn he attributes to deteriorating diplomatic relations. “The kids, the parents want to go,” Levy explained, “but the school boards are saying, ‘Why generate taxes in a country where the president hates us?’” His remarks highlight the compounding effects of tariffs and strained rhetoric, which appear to be discouraging school group travel and family tourism from the country’s traditionally strong neighbor to the north.

K. Krombie, who operates Purefinder New York, echoed these concerns, saying her company has experienced similar declines. “It’s devastating, and utterly noticeable,” she said, pointing to political instability, protectionist trade policies, and a global realignment of travel spending as major contributors to the slump.

The drop in foreign tourism has already started to squeeze some of the most iconic corners of New York City’s service and tourism economy. In Central Park, the horse-drawn carriage industry, which heavily relies on foreign visitors, has seen a marked reduction in rides.

Christina Hansen, a longtime driver and spokesperson for the carriage industry, told VIN News that major demographic groups — including tourists from the United Kingdom, Canada, Ireland, and Australia — have all but disappeared from the city’s central tourist destinations. “We’re missing a lot of our customer base,” Hansen noted, expressing concern about the long-term viability of an industry so dependent on high-spending overseas clientele.

Meanwhile, Midtown restaurants, long buoyed by tourists who pack Times Square and nearby theaters, report fewer international diners and shrinking revenues. Souvenir vendors — many of whom rely on volume sales to overseas customers — also say they are feeling the financial strain.

In response to the downturn, NYC Tourism + Conventions is continuing to invest in global marketing campaigns aimed at reigniting interest in New York as a premier international destination. According to statements published by VIN News, the agency is maintaining its messaging that “global travelers have an open invitation to visit the one and only New York City when they’re ready.”

Still, the scale of the projected losses suggests that tourism officials and city leaders face a steep climb to reverse current trends. With foreign visitor spending historically accounting for billions in hotel stays, Broadway ticket sales, shopping excursions, and dining experiences, any protracted decline could ripple across the city’s broader economy.

The organization’s efforts will now need to balance reassurance with realism. NYC Tourism’s global outreach will aim to counteract narratives surrounding political tension, tariff disputes, and public perception of U.S. attitudes toward foreign travelers — factors that are increasingly shaping vacation decisions abroad.

The implications of a $4 billion shortfall in direct visitor spending extend well beyond the tourism industry. International tourists typically engage in high-margin activities, such as luxury retail, upscale dining, and cultural excursions, all of which feed into a complex ecosystem of employment and taxation across the five boroughs.

While domestic tourism remains strong and is expected to remain stable into 2025, the disproportionate value of international tourism means that any drop in foreign visitors poses a far greater threat to city revenues, particularly those related to hotel taxes, airport surcharges, and business generated in Manhattan’s core districts.

Behind the economic story lies an intricate political backdrop. The comments by school boards in Canada, referenced by Matt Levy in the VIN News report, highlight the extent to which public perception of U.S. foreign policy — particularly toward allied nations — can shape travel decisions. The intersection of tariff policies, presidential rhetoric, and changing global alliances is emerging as a key determinant in travel flows, with New York City tourism now caught in the crosscurrents.

This phenomenon has been compounded by broader global patterns, including a shift in travel to regional destinations, inflationary pressure on airfares, and increased security concerns in major Western cities. The effect is a gradual redirection of foreign tourism dollars away from the United States, with New York — long considered a cultural and commercial epicenter — bearing a disproportionate share of the losses.

In the coming months, NYC Tourism is expected to release updated marketing strategies and potentially collaborate with international partners to rebuild trust and reinvigorate demand. VIN News reported that the success of these efforts may hinge on reestablishing bilateral ties at the governmental level, as well as demonstrating to foreign visitors that New York remains a welcoming, inclusive, and globally engaged city.

For now, however, the numbers tell a sobering story. A 14% drop in international visitation, equating to 2 million fewer travelers and $4 billion in lost spending, threatens not only frontline tourism businesses but also the broader stability of New York City’s post-pandemic economic recovery.

It remains clear that resolving the current crisis in foreign tourism will require a coordinated response — one that spans policy, marketing, and diplomacy, and that recognizes the vital role international travelers play in sustaining the vibrancy and economic health of the city that never sleeps.