Cyprus Mail

Brexit extension puts pressure on tourism prices, negative for revenues

Deputy Minister for Tourism Savvas Perdios (CNA)

The price of travel packages from the UK to Cyprus, which have plummeted by 10-15 per cent this year are expected to drop even further next year as a result of the six-month extension on Brexit until October 31, Deputy Minister for Tourism Savvas Perdios said on Wednesday.

In an interview with the Cyprus News Agency, Perdios said that 2019 would be a difficult year for tourism in Cyprus and that losses from the British and the German market would not be covered.

The UK is the island’s biggest source of visitors at 1.38m last year, but the constant Brexit uncertainty has affected bookings. Perdios said the latest Brexit extension “was something that I am not pleased with”.

“We already have lost valuable ground,” he said, and the new delay, even though it will increase bookings, would hit prices, which have already taken a hit due to the ongoing uncertainty, pressuring tour operators to demand more discounts and deals to fill seats.

“We expect that prices in Cyprus for tourist packages will record a decline of 10-15 per cent and this has happened because the private sector had to offer discounts so that we could hope that we would attract approximately the same number of visitors as last year. That was the cost we had to pay to maintain the same number of visitors,” said Perdios.

This year, he added would be difficult in many aspects. He cited Germany’s slow economic growth, even though the message from the Russian market was more positive. “But this does not mean that any loss from the British or the German markets will be covered. We hope that we will be close to last year’s numbers. We will be happy if we achieve that,” said Perdios. Last year saw almost 4m tourists holiday in Cyprus.

“While we cannot be accurate about the final number of arrivals at the end of the season, we can say with certainty that there will be a drop in per capita spending for sure, since packages will be cheaper than in previous years,” the minister added.

“And the fact that this period has been prolonged until October it essentially means that there will be a decline in prices in 2020 as well as tour operators, especially from Britain, are now starting to prepare their packages for 2020.”

The message was that the pressure from tour operators on prices will continue. “Soon we will be talking about difficulties in 2020 as well,” Perdios said.

Regarding flight connectivity, he said there were currently a lot of flights to and from Cyprus but what was missing were direct flights connecting Cyprus with France and Germany.  Cypriot airline Cobalt, and Germania, which both went bust this year, were providing direct flights to the two countries.

“We are working on this and we continuously try to increase competitiveness either with new airlines or with more flights from the same companies,” said Perdios.

“If we compare the current situation with previous years there has been serious progress, but since we want to develop new markets, such as the Middle East, we will work very hard in consultation with the ministry of transport and Hermes Airports to attract these airlines and let them know that Cyprus is an all-year-round destination which is what they are interested in”.

In terms of future arrivals, Perdios said: “With correct and cautious targeting, marketing and changing of Cyprus’ branding, countries in central and northern Europe will respond”.

He added that he would like to see the new branding launched before next year’s tourism exhibitions that open in March in an attempt to reverse the impression that Cyprus is merely a sun and sea destination.

The new strategy for tourism for the next decade, which is being prepared, would be divided into short, medium- and long-term actions and it will be ready within the next two months, the minister said.

One of the goals is to target visitors from older age groups, while families, another basic category of visitors for Cyprus, would also remain important for the tourism industry.

Perdios said particular emphasis would also be placed on short breaks of three or four days from markets in the region following the government’s cultivation of bilateral and trilateral agreements. Another goal is to attract visitors from long distance destinations such as the US, Canada, Korea, Japan and China who like to travel in the whole region for two or three weeks and visit more than one country.

In order to develop these markets, Cyprus should put particular emphasis on special forms of tourism: health and wellness tourism, rehabilitation, accessible tourism, gastronomy tourism, culture tourism, casino tourism, wedding tourism, mountain tourism, and therefore offer a wide variety of experiences to the visitor, he added.

“We want to keep the sun and the sea as our basic product, but in order to lengthen the season and bring tourism to other areas besides the seafront, we need to target differently in terms of nationalities, demographics and special products,” he said.

He also referred to difficulties concerning the medium-term plan and especially issues related to landscaping, improving lighting on coasts, adoption of new legislation for leisure centres or theme parks and amendments to current legislation.

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