ECONOMY

Pressure from foreign tour operators weighs on tourism

Foreign tour operators are in talks with Greek hotel owners to make sure their money is protected in case the debt-wracked country exits the eurozone next year.

Kathimerini understands that officials representing international tour operators negotiating contracts for 2013 are pressuring Greek hoteliers to agree that if Greece breaks from the euro area and returns to the drachma, they will get their money on the basis of the new exchange rate. Sources told the newspaper that several German-owned businesses are refusing to sign big contracts for next year until after Greece?s parliamentary election on June 17.

Speculation that Greece will leave Europe?s common currency area has been fueled by the lingering political instability since the leading parties failed to form a government after the previous polls on May 6.

A small number of travel companies made similar demands last year, but Greek businesses did not bow to the pressure. This year some tour operators requested that in case there are outstanding payments to be made or bookings are transferred to the next season, transactions would be made in euros, even if Greece swaps its currency.

According to sources, a big German-based tour operator has frozen deposits for this year?s contracts until after the election.

At the same time, tour operators based in countries that make up a smaller share of Greece?s tourism market — such as Romania, Poland, the Czech Republic and Italy — are putting pressure on Greek hoteliers to slash prices by up to 30 percent for this season.

Furthermore, potential visitors appear concerned about the chances of Greece abandoning the euro. They want to know what will happen if Greece goes bankrupt or returns to the drachma while they are visiting the country.

The percentage of the drop in foreign bookings is now in the double digits, according to recent data from the Association of Greek Tourism Enterprises (SETE). In fact, after the election on May 6, the rate of bookings at Greek hotels has slumped by between 30 and 50 percent, according to figures released by the Panhellenic Hoteliers Association. Hotel owners blame the negative trend on the volatile political environment and are calling for urgent measures to remedy the situation.