Our View: Ukraine crisis a setback for tourism recovery

The biggest enemy of any country’s tourism industry is uncertainty, whether it be political, financial, or more recently a health crisis.

Apart from three successive record years, 2017, 2018 and 2019, Cyprus tourism has always faced uncertainties and challenges, some big some smaller. It’s the nature of the industry.

Finally, after two years of weathering the worst tourism crisis since the 1991 Gulf War, and looking forward to a significant recovery in 2022, the latest challenge has hit.

Russian Ambassador to Cyprus Stanislav Osadchiy laid it out in a statement to CNA, saying the volatility of the rouble in the foreign exchange market, as a result of new sanctions would significantly increase the cost of tourist packages denominated in euros, which may negatively affect tourist traffic from Russia to Cyprus.

Osadchiy, also commenting on how EU sanctions might affect bilateral relations between Nicosia and Moscow, said these relations were “once again… becoming a hostage to others’ geopolitical games whose aim is to undermine the friendly relations between the two countries”.

The comment may be couched in diplomatic language but Moscow can’t be too pleased that Cyprus has come down firmly on the side of Ukraine, even collecting money and donations through government-led initiatives and not just following the Brussels line just because they are obliged to. Down the road, the Kremlin may not easily forget that we picked a side.

The crisis is a bit of a double whammy for tourism. Not only do Russians comprise the second largest number of arrivals after the UK, but the Ukraine market was also growing in recent years.

A mere two weeks ago, our ever-optimistic tourism minister Savvas Perdios was in Moscow assuring us that Cyprus had been ranked as one of the top travel destinations for Russians this year. A short-lived prediction that this week left him mumbling something about a Plan B without revealing what that might entail.

Now, Cyprus will be left courting the British market again. When that looked dicey during the Brexit years, we turned more to Russia, and successfully to be fair. But the industry can’t go on lurching from one of its two main markets to the other and hoping for the best.

During the three boom years, tourism benefited from both the UK and Russian markets but that’s three years across three decades. In that time, we’ve gone from putting all our eggs in one basket to putting all our eggs in two baskets.

The current crisis will also doubtless affect all European tourism for a while. People might hold off on travel if there is a knock-on effect on the global financial situation, energy prices, supply chain issues and the rising cost of living.

All of these are already in play due to the pandemic, which itself remains a challenge, as does the tourism industry’s labour shortage, so it’s difficult to see what kind of Plan B could be put in place to mitigate so many obstacles at once in a very short time frame.