Cypriot fintech company WiRE FS CEO Pavlos Loizou this week commented on the state of the tourism sector in Cyprus and how it stands up to financial scrutiny, as well as how it has impacted sustainability efforts on the island.
Loizou noted that at the surface level, Cypriot tourism has thrived over the past two decades, with tourist arrivals and revenue rising from 2.9 million visitors and €2.2 billion respectively in 2001, to 3.9 million visitors and €2.6 billion in revenue in 2019.
These figures represent a 34 per cent increase in tourist arrivals and an 18 per cent increase in revenue generated from tourism.
“But this just masks the true reality of the situation, because if we readjust tourism sector income for inflation, then the actual revenue generated in 2019 was only €1.9 billion, which means that we actually experienced a decrease of 11 per cent in true revenue,” Loizou said.
“Since 2000, we have not been able to increase the real income generated by the tourism industry, despite the increase in the number of tourist arrivals, successive incentive schemes, increase in building rates, subsidies, and other measures,” he added, explaining that this is because “Cyprus chose to prioritise volume over quality”.
Furthermore, Loizou said that Cyprus managed to increase the number of bed places in the tourism sector but finds itself back where it started, while at the same time not respecting environmental laws, wasting water and paying extremely high energy prices.
“We sacrificed our island and we have nothing to show for it, except of course for some exceptions, projects where good, high-quality work has actually been carried out,” Loizou said.
Loizou touched on the recently publicised concerns surrounding the construction work in the Akrotiri salt lake area in Limassol, where the environment department said that poor rainwater management endangers the nearby ecosystem.
“Quality and not quantity is the future of this island, but quality takes work, organisation, rules, oversight, strategy, and vision,” Loizou said.
“We lack most of these attributes, although efforts to improve things are constantly being made both by the government, but especially the Deputy Ministry of Tourism, as well as by the hoteliers’ association,” he added.
In addition, Loizou noted that there is strong pressure from those who own accommodation units to not be forced to invest in them, combined with pressure from landowners and property investors to open up additional areas for development.
“How will we manage to put the interest of our country above ours, when we do not trust the state,” Loizou said.
“This will remain a difficult undertaking unless we give more power and resources to the state and in return, it rewards us with better services and transparency,” he added.
“Technology can play a crucial role in both aspects, so we hope that the government’s digitisation process will help us achieve a better future,” he concluded.