Jailan Halawi reviews tourism experts' take on the global credit crunch Despite the world's current financial crisis, not all seems to be doom and gloom as far as Egypt's tourism sector is concerned. While tourism experts note a 40 per cent decrease in the reservations made by tourists coming from some European markets for the first months of 2009 in comparison to last year, they remain optimistic that the effects can be contained with the right vision and strategy. Minister of Tourism Zoheir Garana, who himself ranks among the top investors in Egypt's tourism sector, believes the reverberations of the global financial crisis will not be felt in the industry till March 2009. He urged all those concerned to study the crisis well and to look for ways to contain the repercussions. He also warned tourism investors against lowering their prices, emphasising that such a drop would lead to grave consequences. Instead, Garana urged all tourism experts and investors to work on enhancing the quality of services they provide while working hard on gaining consumer trust. Recent reports note that many countries are currently working on promoting their tourism sectors as a means of curbing the credit crunch, and are spending millions of dollars to that end. Consequently, the Ministry of Tourism, explained Garana, is embarking on wide range promotional media campaigns portraying the diversity of Egypt's tourist attractions, in a bid to fight fierce international competition. Those in the tourism business also had their share of insights. CEO and Chairman of Travco Group International Hamed El-Chiati, 90 per cent of whose clientele is European, told Al-Ahram Weekly that, "we are expecting a slowdown in bookings and holidays to Egypt from January onwards. We believe this is the best time to carry on with our developmental projects, including the construction of new hotels. After all, people still need to go on holiday." For his part El-Chiati expects a 20 per cent decrease in the number of incoming tourists, "provided the economic situation does not worsen." The slowdown, he noted, "will inevitably lead to a change in the type of clientele, who in their attempt to save money, will be looking for promotional offers and will probably seek out the best opportunities." That insight should no way be understood, according to small and big investors interviewed by the Weekly, to mean that prices should be decreased in a bid to attract more tourists. Such a decrease, experts said, would effectively amount to a shot in the foot for all stakeholders involved. Instead, efforts should be made towards enhancing the quality of services while increasing the number of flights to and from Egypt at affordable prices. General Tours Travel Company Deputy General Manager Mounir Daadouch, the majority of whose clients hail from Eastern Europe, the US and Germany, sees no need to decrease prices. While acknowledging that promotional packages can be used as a means to attract more clients, he was careful to make a distinction between promotions and a general price reduction. Managing Director of Nexus Adventures Haitham Fahmi agrees. "The problem was never in our prices," he told the Weekly, noting that under all- inclusive packages, "tourists coming to Egypt for a week for 300 euros would be spending less than if they had stayed home." Consequently, for small businesses, to ask them to drop their prices would effectively be tantamount to telling them to lose money -- which they cannot afford. "Our prices have been fixed for the past three years, while our running costs have increased. Small businesses have already been squeezed over the past year and they are looking now for a pay-off. What we need is to open new markets and to enhance the quality of services we provide," Fahmi stressed. What the Egyptian tourism market ought to consider, said Daadouch and Fahmi, are the high aviation fares, which remain "inexplicably" high, despite a noticeable drop in oil prices. "This is what drives tourists away," said Daadouch. "We have 700,000 tourists arriving from Eastern Europe at Hurghada and Sharm El-Sheikh. We can double that number if we enhance our flight services and decrease the fares." Of the same opinion is Amira Iskander, vice- chairwoman of Star of Egypt Travel. She advises those in the field not to "mess with their structure of prices. Instead, package things right, through promotions." Star of Egypt is in the top 10 agencies working in events and incentive tourism. Iskander believes the high-end tourists will not be affected at all, though the middle segment will likely "hang on to their dollars". On the other hand, she also thinks that, having gone through crises before, people have learnt that "when the going gets tough, we shouldn't stay put and just let things be. We attempt to take measures to push forward." Optimistic as she is, Iskander went as far as saying that now "is the best time for investment. We have the added advantage of enabling purchases at a lower price. There is no need for people to panic."
