Cyprus Mail
Business Cyprus

Winter season hopes stunted

By Poly Pantelides 

HOTELIERS warned yesterday that the winter tourism season would see 50 per cent of the island’s hotels closed and a dearth of new flights, and it was too late now to do anything about it.

The Cyprus Hotels Association (PASYXE) said it had managed to convince only 59 tourist units (hotels, hotel apartments and tourist villages) to participate in the annual special-offers package for the winter period.

“PASYXE put in intense efforts and encouraged its members to stay open during the winter period assuming their finances allowed,” the association said in an announcement.

But the number of those who were interested and the number of subscribers to PASYXE’s scheme went down from 65 last year to 59 this year. Those who did join are offering an overnight hotel stay for two from €20 for November. Unfortunately, keeping a hotel open is becoming increasingly costly, PASYXE said. Electricity alone is a huge part of overheads.

PASYXE head Haris Loizides said over half of the island’s hotels would stay shut this winter. He also said it was “rather late” for specific action at this stage as the season was already almost under way with a “minimum of new flights operating”.

Loizides, who met with troika representatives at the planning bureau for two hours yesterday, said the international lenders continue to believe that tourism could help pull Cyprus out of the crisis.

He said PASYXE had highlighted some serious problems facing the hotel industry, especially when it came to loan repayments as banks were putting the squeeze on. He said in Europe the average interest rate for hoteliers was around 2.0 per cent to 2.5 per cent while in Cyprus it went as high at 8.0 per cent.

Loizides said hoteliers needed a reduction in electricity charges and council taxes in order to survive at all, let alone stay open all winter.

He said there might be some hope for winter 2014-2015 but work would need to start on that now. Despite diversifying the tourism product to include agrotourism, cultural and religious tourism, sports tourism and conference tourism in recent years to help boost the winter season, a survey published last month by PricewaterhouseCoopers said sun and sea were still the key criteria for 95.6 per cent of tourists choosing Cyprus.

The data from the country’s statistical services corroborate the survey’s findings. At the height of the season in July last year, Cyprus welcomed 371,453 tourists, compared with 94,300 in March marking the end of the winter season. In November last year, around 84,000 people visited Cyprus, which indicates that the island is still failing to attract significant numbers of visitors outside of the peak summer season.

The general manager of the tourist board of the Famagusta region, whose sandy beaches and water sports industry makes it the ideal summer destination, said that from the roughly 170 tourist units available in the region, only 20-25 would be staying open for winter, about the same as last year.

Lakis Avraamides said this related to hotels, hotel apartments and tourist villages offering low-cost holidays to independent tourists mostly from the UK and the Scandinavian countries who used online booking more than travel agents.

There are glimmers of hope, however. Avraamides is keeping his fingers crossed that efforts to liberalise the Moscow and St Petersburg routes will come through. Chartered flights from Moscow and St Petersburg are currently only allowed between mid-April and the end of October, though companies managed got an unofficial extension until November 10.

After that, Cyprus’ second biggest tourist market and the two major cities through which Russians visit will be locked into the more expensive carriers of Cyprus Airways, and Russians Aeroflot and Transaero. Home to over 143 million people, each year tens of thousands more Russians are visiting.

In 2010, 223,861 people visited from the Russian Federation compared with 474,426 in 2012. By contrast, though far more Brits still visit every year, those numbers are steadily dropping. A total 996,046 Brits visited Cyprus in 2010, a little over a million came in 2011, and about 959,000 chose Cyprus in 2012.

The statistical services figures show between 1998 and 2009 the numbers of visiting Brits were always above the one million mark. But with the exception of this February and March when an uncertain financial climate kept visitors away, visits from Russia have been increasing each month in 2012 and 2013.

But for hotels to stay open throughout the year, they need to have some kind of guarantee people will come, Avraamides said “or else why bother incurring the costs?” Allowing charter flights throughout the year would go a long way towards meeting those guarantees, he added.

Some progress has been made towards an open-skies policy, and the communications ministry has liberalised flights with Ukraine. And Latvian airline Air Baltic will be carrying out year-round flights from Riga to Larnaca once a week as of this Monday.

The head of the Larnaca tourist board Dinos Lefkaritis said this might raise the numbers of tourists from Latvia. Just a few hundred tourists from Latvia visit every month and the country is not even included in the statistical services’ interim summaries of main arrivals.

But Lefkaritis said they hoped tourists from neighbouring countries could now connect through Riga. And the head of the Association of Cyprus Travel Agents (ACTA) Yiannis Michaelides even suggested the Latvian route could be an “easy and practical choice” for people from Russia, and might help Cypriots connect to Europe’s cities. A more blunt way of putting it would be getting to and out of Cyprus is hard and people often have no choice but to take connecting flights.

Back in March when an eleventh hour international bailout was agreed for Cyprus, the troika of lenders referred to tourism in the memorandum of understanding as “an important potential driver of future growth”. The word they chose was “potential,” a word whose choice becomes evident during a winter stroll across the empty sandy stretches of Ayia Napa that just a few months ago were buzzing with life.

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