Let’s accept 2016 as ‘lost year’ for Turkey’s tourism sector
Things are getting worse for Turkey’s tourism sector, with crisis after crisis erupting before the last one is resolved. The situation is so bad that we should simply accept this year as a “lost year” for tourism and see this crisis period as a chance to transform the entire sector for the better.
Many Turkish tourism representatives have voiced their concern that the sector will suffer further, amid this week’s attack in Istanbul’s Sultanahmet, the ongoing diplomatic crisis with Russia, and escalating security concerns in the southeast. Current developments have the potential to damage Turkey’s “safe and secure country” image.
Turkey saw a dramatic drop in the number of foreign arrivals from Europe and Russia in the first 11 months of 2015, according to temporary official data. Although the number of total foreign arrivals saw only a slight decline (around 1.36 percent) in the period compared to the first eleven months of 2014 - due to an increase in arrivals from Gulf countries - tourism revenue is the main indicator that should be considered.
Tourism revenue matters a lot for Turkey, accounting for around 4.5 percent of its $800-billion economy and playing a crucial role in closing the multibillion-dollar current account gap.
Even before the latest attacks, sector players expected to close 2015 with losses of around $10-11 billion, amid a dramatic drop in Russian tourists and a sharp decline in hotel room prices across the country.
Concerns about the future of the sector have escalated further after an Islamic State of Iraq and the Levant (ISIL)-linked suicide bomber killed at least 10 foreign tourists and left 15 wounded on Jan. 12 in Istanbul, which the annual MasterCard Global Destinations Cities Index said was world’s fifth most-visited city in 2015.
With the Sultanahmet attack, many sector players fear a drop in the number of German tourists. In 2014, Germany was the largest source of tourists for Turkey and more than 5.2 million Germans visited the country.
The sector already appears to have lost hope for the Russian market, with Turkish Tourism Minister Mahir Ünal saying on Jan. 14 that a number of measures will be taken to recover losses from the fall in 4.5 million Russian tourists visiting this year.
Now it is time for the sector to sort out its problems and reflect on how to resolve these problems.
Firstly, it is impossible for Turkey to lure tourists if worries about its security continue to increase. A positive image cannot be built up without an atmosphere of peace. Nobody wants to visit an unsafe destination for leisure, business or health.
Secondly, sector players need to develop new models, rather than stick to the all-inclusive hotel concept. The latter is generally the most popular preference among Russian tourists, and it has long been the sector’s main motoring force.
Thirdly, efforts should focus on diversification of tourism areas. One of the most promising new tourism areas for Turkey is medical tourism, although the share of income from medical tourism is still very low in the total.
Turkey managed to increase its tourism income from $8 billion in 2000 to around $35 billion in 2015, making it the 12th highest tourism income earner in the world. The sector will recover some of its losses sooner or later, but for this to happen Turkey needs to resolve the crisis in the perception of its safety.