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TOURISM >Not easy to cover tourism losses: Business group

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With many Russians holidaying elsewhere due to the now-resolved row between Moscow and Ankara, Turkey stands to lose between $8 billion and $10 billion in tourism revenue by the end of the year, according to Çetin Gürcün, the secretary-general of the Association of Turkish Travel Agencies (TURSAB). 

“If we consider the volume of the Russian market, it’s not easy to fill the void,” Gürcün told The Associated Press.

The first Russian charter plane carrying tourists to Turkey since Moscow lifted travel sanctions imposed over the shooting down of a Russian jet in November last year landed in the Mediterranean resort of Antalya on Sept. 2.

The Royal Flight airlines plane touched down at Antalya Airport after Russian Prime Minister Dimitry Medvedev last month signed a decree which lifted a charter flight ban, Doğan News Agency reported.  

Turkey and Russia normalized ties in June after Turkish President Recep Tayyip Erdoğan sent a letter to Russian counterpart Vladimir Putin expressing regret over the incident. Turkey-Russia relations are now back on track, but Gürcün said he didn’t expect the Russian market to rebound before next year.

However, it hasn’t just been Russians who have stayed away from Turkey’s beaches and the cultural delights of places like Istanbul.

Thomas Cook, the British-based holiday company, said recently that demand for Turkish holidays was “significantly below last year’s level” and that its overall bookings for the summer 2016 season were down by 5 percent, largely because of “geopolitical disruption.”

Russia was Turkey’s second-largest tourist market with 4.5 million people visiting places like the Turkish tourism capital of Antalya in 2014.

Official Turkish figures for the entire summer tourist season have yet to be released, but sector representatives have said it was clear it took a hit. 

June and July alone saw tourism arrivals plunge 40 and 36 percent, respectively.

With fewer tourists, retail sales have suffered. Sami Kariyo, head of the United Brands Association, an umbrella group representing 150 member companies and 500 brands, said lower tourism numbers have translated into a 5 percent drop in revenues.

Industry has been affected as well. The most recent figures showed that industrial production in July fell by almost 5 percent year-on-year, the sharpest fall since the start of the current data series in 2005.

“The coup attempt in July seems to have a very marked negative impact on economic activity,” said William Jackson, a senior emerging markets economist with Capital Economics, referring to the failed coup attempt in Turkey on July 15. 

The growth forecasts for the Turkish economy have been revised down. Turkey is expected to post what - at first glance - looks like reasonable growth this year of a little more than 3 percent. But before the attempted coup, most independent economic forecasters had penciled in Turkish economic growth of around 4 percent this year.

Erhan Aslanoğlu, a professor of economics at Istanbul’s Piri Reis University, told The Associated Press that Turkey’s economy was tough enough to weather the worst of the storm, but needed more than 4 percent growth to continue pushing down unemployment.

“It’s better than many European countries, but not enough for Turkey,” he said.

Since the coup was foiled, tens of thousands of civil servants and have been dismissed while scores of businesses have been shut down over suspicion of links to U.S.-based Islamic scholar Fethullah Gülen, the main suspect behind the attempted coup.

“The rule of law is extremely important,” Atilla Yesilada, an analyst with emerging markets consultancy GlobalSource Partners, said.

September/18/2016

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