Much has been heard lately regarding the course of tourism and much more has been said in case the arrivals and tourist revenues of previous years are not achieved. In recent years, due to the strategy aimed at differentiating the tourist pie in terms of attracting tourists from other markets but also due to external factors, it has become possible to achieve one record after another in terms of revenue and tourist arrivals. However, everything shows that this year things will not be the same. Already the first signs, which began to appear, indicate that at best arrivals will be maintained at the same levels as last year.
Just to mention that for 2018 tourist arrivals amounted to 3,9 million, an increase compared to the previous year of 7,8%, while revenues from the tourism sector reached 2,7 billion euros. At the same time, it should be mentioned that the contribution of the tourism product to the Cypriot economy for 2018 amounted to approximately 13% of GDP.
A number of open issues such as Brexit, the bankruptcies of airlines that have had flights with Cyprus and the recovery of neighboring markets, lead to the conclusion that the risk of a possible reduction in tourism in Cyprus is visible. This fact will inevitably have negative and chain reactions for many sectors of the economy that are either directly or indirectly related to the tourism sector. Areas such as retail, construction, leisure centers, tourist buses and more are expected to be particularly affected.
ACUTE COMPETITION
The new Deputy Minister Savvas Perdios has admitted that 2019 will be a difficult year for our tourism. In previous statements, Savvas Perdios stated that our competing destinations, such as Turkey and Egypt, started accepting bookings early this year, in contrast to last year, when they received bookings from the summer onwards due to insecurity. "Egypt has great potential for recovery, as the country in the past reached up to 14 million arrivals, compared to just 8 million recently," the deputy minister said in a statement. Regarding Turkey, the Deputy Minister of Tourism pointed out that the Turkish pound, against the pound sterling, is about 30% cheaper than last year. "Therefore, the competition will be great this year", he noted and reminded "that Turkey and Egypt have significantly lower operating costs compared to Cyprus, so they have a competitive advantage that can hardly be addressed".
ATTENTION TO TRADE
Retail trade plays an important role in the Cypriot economy. Suffice it to say that based on a recent study by KPMG Cyprus, the total contribution of retail, tourism and wholesale trade in 2018 amounted to 25% of GDP. Also in the retail sector employment, as a result of the strong recovery presented by the economy in recent years, was upward and between the years 2014 to 2018 amounted to 16,3% according to the Statistical Service. The general secretary of the Retail Trade Association, Marios Antoniou, stated that undoubtedly if we do not have the numbers we would like to have this year, this will have a negative impact on both the tourism sector and other sectors of the economy, as there is a direct connection to tourism. of Cyprus with retail trade. He stressed that if 2019 will be a year that will reduce the tourist flow in Cyprus, then inevitably there will be a similar reduction in retail trade. "However, we wish and are optimistic according to the statements of those in charge that the numbers for tourism will remain the same as in 2018, with the result that we have a similar course in the retail trade. "For five consecutive years, the retail trade has been recording continuous increases, while in the first four months of 2019, its course is also good and we hope that it will continue", he concluded.
The same applies to another sub-sector of the retail trade such as the beverage sector (alcoholic and non-alcoholic). As Mr. Vassilis Petridis, of the Association of Importers and Distributors of Alcoholic Beverages of Cyprus, told us, this sector is inextricably linked to tourism flows and therefore a not so good year for tourism will affect this sub-sector of retail trade accordingly. As he pointed out, the largest turnover during the summer months is through the supply of hotels and leisure centers. "So it is understood that a reduction in the tourist flow will affect our sector as well. "The bet is to be able to attract quality tourism, which will have increased costs", he pointed out.
Interaction with constructions
A similar picture for the construction sector, which undoubtedly together with tourism were and are the pillars of the Cypriot economy. According to the same study by KPMG, the contribution of real estate and construction to the Cypriot GDP reached 2018% in 16, while according to the latest data of the Statistical Service, building permits have increased on an annual basis by 22%. As it is understood, the construction sector, which employed more than 2018 thousand at the end of 33, is leading the employment race with the increase between 2014 and 2018 reaching 33,8%. Asked if a drop in tourism in Cyprus will affect the construction sector, the president of the Association of Contractors, Costas Rousias, noted that it will certainly affect, since what has been seen in recent years is that the increase in tourism has given hoteliers a boost. to proceed with the construction of new hotels or with the expansion and renovation of their existing hotel units. This means that with the increase in the tourist flow that has occurred in recent years, there has been a similar increase in the construction sector, resulting in a boost to the entire economy of the place.
In the same vein are the reports of the representative of the Pancyprian Association of Water Sports, Dimitris Hatzidimitriou, who notes that for the owners of water yachts, quality tourism plays an important role and not quantity. "If tourists lose their purchasing power then their expenses will be reduced, as a result of which we will also lose significant revenues in our sector. "We are certainly concerned and we hope that there will be no significant reduction," he said. He also noted that in recent years this sector has an upward trend in turnover, however revenues have decreased and this is due to increased operating costs such as licensing and high fuel prices. "All this leads to a significant increase in our expenses and therefore to a reduction in our profits. "If one considers a possible decline in the tourist flow, then surely all this will have negative consequences", he concluded.
Source: Philenews