October 30th, 2017 
(CHRON) — In the spring break capital of Cancun, Mexico, hotel occupancy has tumbled 10 percent this year. As bad as that is, over in Los Cabos, on the tip of the Baja California peninsula, it’s worse.
The airport serving Cabo San Lucas and its lesser-known sister city, San Jose del Cabo, is looking emptier these days. And hotel guests have canceled 35,000 nights of bookings over the next year – collectively a decade’s worth of visits for a single traveler.
At a time when the weaker peso should be luring American travelers in droves, many are staying away, spooked by a wave of violence that’s come dangerously close to tourist hot spots. Gunmen opened fire at a Cancun nightclub in November, and a cooler with two human heads was found on Cabo San Lucas’s main hotel strip in June.
But the biggest blow came on Aug. 22, when the U.S. State Department issued a travel warning advising tourists to steer clear altogether.
“Group tourism automatically went down the moment the warning hit,” said Carlos Gosselin, head of the hotel association for Cancun and Puerto Morelos. Many insurance companies likely won’t even consider offering coverage in areas under advisory, hurting conventions and events in the area, he said.
Mexico is reinforcing security in popular tourist spots to get the State Department to revise its views, and companies including Hilton Worldwide and Marriott International are spending millions to make guests feel safer. Their motivation is clear: Barclays estimates that a drop in tourism could wipe out as much as 0.5 percentage point from Mexico’s gross domestic product growth this year.
“Lower tourism activity will definitely have an impact on growth,” said Marco Oviedo, head of Latin America economic research at Barclays. “External tourism is one of the most important sources of income in the current account.”
Mexico gets about $20 billion a year from tourism. With murders quadrupling in Los Cabos and doubling in Cancun this year, a chunk of that revenue may be at stake. Quintana Roo, the state where Cancun is located, is the destination of a third of all the nation’s international tourists.
In Los Cabos, local and federal authorities are teaming up with hotels, time-share companies and the airport operator to step up the area’s security.
The group is spending $50 million to increase surveillance cameras to cover the 20-mile main stretch that includes hotels, restaurants and public beaches. A new military facility, paid for in part by the private sector, will be built near a highway to respond to any activity spotted on the cameras. It is set to open in the second quarter of 2018.