The Directorate-General for Trade and Consumer Affairs of the Canary Islands Government is currently processing specific retail licences for several shopping centres. The processing has not yet completed the administrative phase. Yet, for Director-General David Mille, it demonstrates how retail has gained a strong foothold in the archipelago.
What is the volume of investment and footfall generated by the retail sector in the archipelago?
David Mille: According to the most recent statistics, economic activities linked to retail, transport and hospitality represent 34.2% of GDP in the Canary Islands, consolidating its position as the most important sector in the regional economy.
If we consider retail activity alone (excluding transport and hospitality), the retail sector generates around 17.9% of total employment on the islands, making it one of the largest employers in the region. This figure highlights the importance of retail in its capacity to generate jobs and promote socio-economic development in the Canary Islands.
What challenges are wholesale trade and retail currently facing?
DM: The business fabric of the retail sector in the Canary Islands is characterised by a marked presence of micro-businesses. According to the Structural Business Statistics and data from the Central Directory of Companies (DIRCE), more than 95% of retail companies in the Canary Islands have fewer than 10 employees.
Within the sector, retail accounts for the largest number of business units (16,672), 64% of the total, followed by wholesale trade (6,155), at 23% of the total, and, to a lesser extent, vehicle sales and repair activities (3,386), which represent 13%.
This predominance of retail reflects the economic structure of the archipelago, where small and medium-sized enterprises geared towards the end consumer play a fundamental role. Wholesale trade businesses, although fewer in quantity, play a key role as an intermediary in the supply chain, whilst the automotive industry, with a smaller presence, continues to be a strategic sector linked to both local mobility and tourism.
The high percentage of micro-SMEs in the sector means that it faces challenges such as logistical disruption and increased transport costs, which affect island territories more specifically. Other significant challenges include generational renewal, which is accentuated in the Canary Islands by the high rates of ageing population, and the need to adapt traditional retail to new omnichannel consumers.
“More than 95% of retail companies in the Canary
Islands have fewer than 10 employees”
How can the competitiveness of retail be improved and youth unemployment reduced?
DM: It is essential for the sector to adapt to new types of consumers who seek the same experience in physical stores as they do online. Physical points of sale are not going to disappear due to digitalisation. Yet, stores as we know them must be digitalised and adapt to new forms of shopping, in which a positive, seamless experience is paramount.
The acquisition of digital skills is closely linked to training. It is necessary to promote dual vocational training and enhance the prestige of employment in the retail sector.
To do so, we need the younger generations to perceive that retail speaks their language. Only then will they be interested in starting or developing a professional career in the retail sector.
For this reason, the Ministry of Economy, Industry, Trade and the Self-Employed of the Canary Islands Government has launched an ambitious plan to promote dual vocational training in the retail sector, in close partnership with the Ministry of Education of the Canary Islands Government. The aim is to achieve a 10% increase in enrolment on the dual vocational training programme in retail, offered in the Canary Islands, by 2028, thereby reaching more than 4,500 enrolled students.
Is the sustainability and refurbishment of shopping centres another major challenge?
DM: On some islands, mainly in Gran Canaria, there are a number of shopping centres that were built decades ago and, because they are located in tourist areas in the south of the island in the case of Gran Canaria, are in urgent need of refurbishment. It is necessary to adapt the floor space dedicated to retail to the tourist environment, so that the Canary Islands can become a shopping destination for our visitors.
In 2024, the Ministry carried out a comprehensive, multidisciplinary study entitled ‘Diagnosis and Action Plan for the Management of Private Retail Infrastructure and their Relationship with the Tourist Environment’. The study analysed the types of shopping centre in tourist areas from various perspectives (retail, urban planning, architecture, etc.). This resulted in a comprehensive diagnosis of their life cycle and a series of proposals for action.
“It is necessary to promote dual vocational training
and enhance the prestige of employment
in the retail sector”
What role does digitalisation play in driving competitiveness in retail in the Canary Islands?
DM: At a regional level, I would highlight several initiatives by the Canary Islands Government aimed at promoting the use of innovation, and within that, digitalisation, by companies and professionals.
The Canarias Aporta programme is a line of funding administered by Proexca. Since 2015, it has been supporting the internationalisation of companies in the Canary Islands through specialised technical advice and funding for business expansion projects outside the Islands.
In 2020, the Aporta Digital line of funding was added to the programme. It supports e-commerce projects, as well as those facilitating the digitalisation of companies and connection, through digital media, with operators located outside the Canary Islands.
In March 2022, the Directorate-General for Trade launched the Canary Islands Retail Institute, a collaborative virtual space to facilitate innovation, digital transformation and the exchange of knowledge in the retail sector, and to promote co-operation between all interested parties.
Likewise, the Directorate-General for Trade, in collaboration with the University of La Laguna and the University of Las Palmas de Gran Canaria, as well as the network of civil society associations, has launched a programme for the digital transformation of retail in the Canary Islands, currently endowed with 600,000 Euros. It aims to train 200 companies and entrepreneurs in both provinces during the period 2024-2025.
At the end of 2022, modernisation funding was announced, known as the Technology Fund for the modernisation of local trade, with 4.9 million Euros from the Recovery and Resilience Facility.
“It is necessary to adapt the retail sector to the
tourist environment, so that the Canary
Islands can become a shopping
destination for our visitors”
In 2024, the programme ‘The Canary Islands, a smart retail destination’ was launched. What does this initiative comprise?
DM: The aim of the programme is to transform the retail sector to make the Canary Islands a smart retail destination, through strategic levers such as infrastructure and data, innovation and digital transformation, sustainability and the environment It aims to position our retail areas as true hubs for the promotion of tourism and the Canary Islands experience.
With six million Euros for the period 2024-2025, it received applications for more than 20 million Euros for the period in question. 28 projects were funded, which were submitted by associations, federations and groups of organisation representing the retail business, traditional markets and street markets, as well as local entities.
We are currently processing the 2025-2026 call for proposals, with a total of five million Euros. More than one hundred projects have been submitted.
What revitalisation plans are currently in place to boost the local economy?
DM: The Ministry is developing a series of programmes aimed at improving open retail areas, as a traditional sales space existing in all municipalities of the Canary Islands, such as the call for grant applications for the programme to support complementary projects for open retail areas. Aimed at local entities, and comprising 900,000 Euros for the 2025 financial year, this programme co-finances projects, such as investment in projects to enhance the beauty of open retail areas, street furniture, green areas, signage, as well as investment in strategic plans and master plans for these areas.
In rural areas, we have a call for grant applications for the programme to support rural retail areas. This is aimed at associations and local councils, with 300,000 Euros for the 2025 financial year, and subsidises investment projects that promote economic and retail activity in rural municipalities.
In relation to our open retail areas, on one hand, the Plan for the revitalisation and promotion of open retail areas is being developed, with 750,000 Euros for the 2025 financial year, through which revitalisation actions are being carried out. There is also a call for grant applications for the programme to revitalise open retail areas, with 800,000 Euros for the 2025 financial year, aimed at business associations, which subsidises investment projects that revitalise activity in open retail areas in the Canary Islands.
No less important is the programme for the management of retail facilities, with 90,000 Euros for the 2025 financial year. It aims to identify and formulate proposals to improve retail management and facilities in open retail areas in our municipalities.