ECONOMY

Hoteliers grateful for weaker euro, oil drop

Fluctuating foreign currency rates may affect the number of tourism arrivals in Greece this season to a greater extent than in the last few years, according to the president of the Hellenic Hotel Federation, Yiannis Retsos.

The weakening of the euro – against the US dollar and the British pound in particular – is making European destinations considerably cheaper for American and British holidaymakers. There have already been reports in the US and British media referring to the advantages of continental Europe as a destination, recommending early bookings for tourists to make the most of the exchange rates.

In this context Greece can reap significant benefits, argued Retsos, raising its share from the British market – the second biggest for Greek tourism – and the USA.

The rise of the dollar against the euro also makes other destinations where the dollar is used more expensive, which according to Retsos will play a role in the travel choices of Northern Europeans, as in previous years they chose long-haul dollar destinations with competitive prices compared with Southern Europe.

Another positive element for this season will be the decline in global crude oil rates. This reduces costs for air carriers as well as hotel enterprises’ operating expenses, which contribute to the lowering of prices for package holidays.

On the other hand, the head of Greece’s hoteliers points to the problems in the Russian travel market. The crumbling of the ruble in recent months has been added to the issues affecting outgoing tourism from Russia since early last year, such as successive tour operator bankruptcies and rocky relations with the European Union. For this year all forecasts point to a further decline in Russian tourists, not only in Greece but other destinations too.

Retsos stresses that the growth trend in bookings for the 2015 season remains in positive territory, having started with great momentum in fall 2014. There was a drop in the rate of new bookings in hotels’ online reservation systems in December compared to November, attributed to the political uncertainty that began in Greece at that time. In the last few days the flow of bookings seems to have been returning to normal despite the political tensions.

Still, Retsos sounds a note of warning to the country’s political parties, reminding them of the crucial role that the handling of the election process will have in the maintenance of the positive climate for Greek tourism. To date, he said, the political clashes have been based on fear and anger and not on the comparison of various arguments, as the market expects to see.