Leading Turkish tourism player expects $15 bln loss in revenue in 2016

Leading Turkish tourism player expects $15 bln loss in revenue in 2016

Burak Coşan - ISTANBUL
Leading Turkish tourism player expects $15 bln loss in revenue in 2016

DHA photo

Turkey’s losses in tourism revenue may increase up to $15 billion over this year due to rising security concerns and the Russian crisis, according to a leading sector representative.

“Our country’s loss in tourism revenue may increase up to $15 billion over this year and the decline in tourist numbers by 30 percent compared to 2015,” said the head of the Tourism Investors Association (TYD), Murat Ersoy, in a press meeting on June 1. 

The number of foreign arrivals visiting Turkey slumped by 28 percent in April to 1.75 million compared to the same month of 2015, marking the steepest decline since May 1999, according to data by the Tourism Ministry. The number of foreign people visiting Turkey decreased by 16.5 percent to 5.82 million in the first four months of this year compared to the same period of 2015, data also showed. In the first three months of 2016, tourism revenue decreased to $4.07 billion with a 16.5 percent drop, according to data that was released by the Turkish Statistics Institute (TÜİK) on April 29. Tourism revenue was $31.5 billion in 2015, an 8.3 percent decline compared to the previous year. 

The main problem for the sector is that many foreign tour operators are focused on alternative markets, creating new competitors for Turkey, according to Ersoy.

He said the total revenue of leading tour operators in the region came mainly from Turkey and Egypt, but with rising security concerns in these two markets they have started to turn their eyes to alternative markets. 

“These companies have faced the risk of losing some 60 percent of their revenue so they started promoting new countries in a bid to diversify their markets. This will lead to the creation of some permanent competitors for Turkey. We can overcome these cloudy days by finding new markets,” he said. 

The launch of direct flights to tourism destinations will be crucial, as tour operators halt flights to any destination where they see even minor risk, according to Ersoy. 

Saying that the state offered considerable support to companies which make scheduled flights, he added:

“This was quite a positive step which will secure the tourist inflow into Turkey. We also need more international hotel brands, which will launch cooperation with leading airline companies in Turkey to lure more foreign tourists. In short, we need to create new markets by ourselves.”

‘Rise in tourist number after Eid Ramadan’

According to Ersoy, Turkey will continue to see a decline in tourist numbers until Eid Ramadan, but the number of tourists visiting Turkey will start to increase after this date, mainly from Muslim countries. 

Denizbank CEO Hakan Ateş said the lender continues to offer loans to 108 TYD members, adding that a total of $18.3 billion in loans were offered to the tourism sector as of March 2016. 

“Denizbank offered 16 percent of this amount, topping the list. While the loans offered to the sector decreased by 11 percent in the first quarter of the year compared to the same period of 2015, our loans to the sector increased 4 percent. Tourism revenue plays a crucial role in Turkey’s economy, especially in closing the current account gap,” he said, vowing that the lender would continue to support the sector.