Gov’t vows to protect firms from Thomas Cook collapse

Gov’t vows to protect firms from Thomas Cook collapse

LONDON-Anadolu Agency
Gov’t vows to protect firms from Thomas Cook collapse

Turkish authorities have stepped in to mitigate the possible adverse effects on local companies from the collapse of the world’s oldest travel firm Thomas Cook, promising financial support.

The Turkish Culture and Tourism Ministry said on Sept. 23 it would shortly provide a credit support package with the country’s Treasury and Finance Ministry for tourism firms affected by the company’s collapse.

Local authorities also reassured tourists in Turkey who booked and paid for their holidays through Thomas Cook.

Turkey’s tourism establishments cannot request additional payments from Thomas Cook customers, the Tourism Ministry said on Twitter.

“The payments of Thomas Cook U.K. guests staying in Turkish tourism establishments - including for over the weekend - are guaranteed by the Air Travel Organiser’s Licence [ATOL] of the U.K. Civil Aviation Authority [CAA],” the ministry said.

It noted that that as of yesterday, there were over 21,000 guests of Thomas Cook U.K. in Turkish accommodation facilities.

“If establishments request additional payments from Thomas Cook U.K. guests or vacate them from their rooms, these establishments will face legal action,” the ministry said.

Rescue operations

Around 600,000 holidaymakers around the globe are stranded after the collapse of the travel firm, sparking the largest peacetime repatriation effort in British history.

The CAA said yesterday Thomas Cook had ceased trading and the regulator and the U.K. government had a fleet of planes ready to bring home the more than 150,000 British customers over the next two weeks.

The liquidation marks the end of one of Britain’s oldest companies that started life in 1841 running local rail excursions before it survived two world wars to pioneer package holidays and mass tourism.

The firm ran hotels, resorts and airlines for 19 million people a year in 16 countries, employing some 22,000 people around the globe.

The group had seemed set for a rescue when it agreed the key terms of a 900 million pound recapitalization plan with its biggest shareholder, China’s Fosun, and the travel firm’s banks in August.

But in finalizing the terms of the deal, the company was hit with a demand for another facility of 200 million pounds in underwritten funds by its banks.

In the longer term, the collapse of the company could also hit the tourism sectors in the company’s biggest destinations, such as Spain and Turkey.

Turkey could miss out on 600,000-700,000 tourists a year, the head of Turkey’s Hoteliers Federation (TÜROFED) told Reuters yesterday.

Osman Ayık noted that Thomas Cook owed 100,000-200,000 pounds each to some small hotels, which could suffer as a result of the travel agency’s collapse.

Last year, 2.25 million British tourists visited Turkey, a strong 36 percent increase from 2017. In January-July this year, the number of British tourists increased 18 percent to 1.2 million.