Tourism Minister says Brexit extension to affect holiday prices

Deputy Minister for Tourism Savvas Perdios expects prices of travel packages from the UK to Cyprus that have plummeted already by 10% - 15% this year, to drop even further in 2020, as a result of the six-month extension of the Brexit process, with which he is not pleased.

In an interview with the Cyprus News Agency (CNA), 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.

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

Invited to elaborate on the basic pillars of the strategy, he said that considering the demographics of Europe, where 50% of the residents will be 50 or even close to 60 years old in the next decade, one of the goals is to target visitors from other age groups, whereas families, another basic category of visitors for Cyprus, will also remain important for the island’s tourism industry. He added that particular emphasis would be placed to the so called “short breaks”, that is short visits of three or four days in duration from countries of the wider Eastern Mediterranean region, following the Government’s bilateral and trilateral agreements signed with them. He also noted that another goal is to attract visitors from long distant countries such as the US, Canada, Korea, Japan and China that like to travel in the region for two or three weeks and visit more than one country, by utilizing flights or flight schedules of countries in the Eastern Mediterranean.

At the same time, he stressed that 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. Targeting, Perdios said, is very important if Cyprus is to lengthen its holiday season. “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 sea front, we need to target differently in terms of nationalities, demographics and special products”.

Since the targeting has been announced, he explained, the Deputy Ministry shall prepare an action plan for the next decade. “I believe it will be ready in the next two months, we will be in a position to announce it to the stakeholders at that stage and carry out a consultation again”, said the Deputy Minister, adding that the action plan will be divided into a short term period (2019 – 2021), a medium term period (2022-2024) and a long term period (2025-2030).

According to the Deputy Minister all the actions of the medium- and long-term plan must fall within the environmental study that has to be carried out in continuation of the national tourism strategy legislation, whereas the short-term actions have to do with marketing, branding, targeting and therefore they can be implemented immediately.

Asked which could be the biggest obstacles in the implementation of the new plan, Perdios said that it is very important to be in agreement with stakeholders in the tourism industry, noting that there is a wider understanding with them. 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 centers or theme parks and amendments to current legislation.

The Deputy Minister told CNA that 2019 will be indeed a difficult year in many aspects. He cited Germany’s slow economic growth and noted that Brexit causes insecurity to British travelers, as a result of which Cyprus has been losing ground. He pointed out that messages from the Russian market are more positive and arrivals from that country are projected to reach last year’s numbers, but added that “this does not mean that any loss from the British or the German market will be covered. We hope that we will be close to last year’s numbers. We will be happy if we achieve that”.

In terms of future arrivals, the Deputy Minister pointed out that “with correct and cautious targeting, marketing and changing of Cyprus’ branding, countries of the central and northern Europe will respond”. He added that the Deputy Ministry 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.

Asked how is Cyprus going to be affected by the extension of Brexit until 31 October, Perdios said the extension “was something that I am not pleased with” and this is because “we already have lost valuable ground”. The extension, according to him, will help to increase reservations for this year, but prices have already taken a hit, because of the uncertainty around Britain’s exit from the EU that increased pressure from tour operators for lower prices. “We expect that prices in Cyprus for tourist packages will record a decline of 10-15% 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”.

As a result, tourism revenue will be affected, he said. “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. 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”, Perdios said. He also added that they already get messages that pressure from tour operators on prices will continue. Soon, he pointed out, we will be talking about difficulties in 2020 as well.

Regarding flight connectivity, the Deputy Minister said that there are a lot of flights to and from Cyprus, but added that what is missing at the moment is a direct flight connecting Cyprus with France and Germany. “We are working on this and we continuously try to increase competitiveness either with new airlines or with more flights from the same companies. 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”.