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Greek Tourism is making a comeback

Greek Tourism is making a comeback

Tourists are returning to Greece in big numbers, easing fears that capital controls and anti-austerity protests would undermine one of the cash-strapped country’s few successful industries in the middle of the northern summer.

Hotel bookings, which suffered early this summer as the country teetered on the brink of bankruptcy, have recovered since the Greek government reached a tentative bailout deal with creditors on July 13. Tour operators and airlines also say their reservations are showing renewed vigour.

“We are weathering the crisis reasonably well,” said Aris Ikkos, research director at the Institute of Greek Tourism Confederation (SETE), which groups the country’s hoteliers, travel agents and other tourism firms.

In the last days of June and early July, hotel bookings were down 20 per cent year on year, he said, “but since then there are strong indications of an increase and we estimate we are at par or slightly up from levels last year”.

Tourism is one of the main sources of income in Greece’s depression-ravaged economy. Last year, it directly contributed €17 billion ($25.6bn), or 9.5 per cent of gross domestic product, and as much as €45bn in indirect benefits from spending in shops, restaurants, tourist sites and elsewhere, according to SETE.

Hopes Greece could have another bumper tourist year were dashed when the Greek debt crisis escalated in June.

A referendum on austerity measures brought bailout talks with the country’s creditors to a temporary halt, forcing the government to impose capital controls that have been in place since June 29. But the €60 daily limit on cash withdrawals from ATMs doesn’t affect foreign bank card holders, leaving tourists largely unscathed by the continuing restrictions on bank transactions Greeks face.

Though travellers held back in late June amid uncertainty about access to cash, their concerns appear to have abated since the bailout accord.

“We are hoping that we won’t go through another round of political drama for the rest of the summer season,” Mr Ikkos said. “We had 22 million arrivals for the whole of last year and if calm prevails we may even slightly surpass that level.”

While making life difficult for most Greeks, the crisis is a boon for thousands of travellers seeking a luxury holiday in Athens or the Greek islands: prices for high-end accommodation have fallen as much as 15 per cent year on year, according to travel operators.

“For June, luxury travel accommodation in Greece was up 22.4 per cent on year,” said Daniel Farrar, chief of Switchfly, which provides global booking platforms for airlines and hotels for up-market travellers.

“We expect a similar on-year increase for July,” he said.

“Every year economic, social, and political events affect travel trends, and this year we’ve seen a rise in travel to Greece as the country’s economic crisis has made travel more affordable. Greece is the only country with three destinations among the top 15 luxury venues around the world this summer.”

High-end hotels in Athens, Mykonos and Crete are fully booked to the end of September. Aegean Airlines has increased flights to Athens from the rest of Europe by 30 per cent for summer, and 10 new global airlines have started daily flights in and out of Athens this year.

source: THE WALL STREET JOURNAL

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