articles | 21 January 2014

Cyprus tourism regaining ground

Despite a slight decrease recorded in tourist arrivals in 2013, it is considered a very satisfactory year with a 9% increase in tourism revenue in one of the island's hardest years for the economy.

Tourism officials said recently that the results were positive considering the unprecedented Eurogroup haircut decision in March while 2014 is expected to show an improvement. "Despite a slight decrease recorded in 2013 it is considered a very satisfactory year after the decisions in March when arrivals fell 70% in some cases," Cyprus Tourism Organisation chief Marios Hannides said in statements to the media. He said the most satisfying achievement was that Cyprus increased its tourism revenue by more than 9% "in one of the worst years for our economy".

Fewer tourists travelled to Cyprus in the aftermath of last year's bailout crisis when the eurozone country's banking system almost collapsed, official figures for 2013 suggested. In 2013 there was a 2.4% dip in tourist arrivals to the holiday island reaching 2.40 million from 2.46 million in 2012, according to the state passenger survey. In return for €10 billion in aid from international lenders, the island in March agreed to wind down its second largest bank - Laiki - and impose losses on depositors in under-capitalised largest lender, Bank of Cyprus. All bankswere shutdown for two weeks while Cyprus is the only eurozone member to still enforce capital controls.

Despite an overall drop in arrivals, improved revenue is fanning hopes that the key sector can pull the economy out of recession in the near future. The largest annual fall in tourist arrivals was a 31.5%plunge from Germany, followed by a 21.1% dip from Greece and a 7.1% drop from Britain - the island's biggest market. Greece is the island's third biggest tourist market with 104,955 visiting in 2013. Only a sharp 28.3% spike in high-spending Russians in 2013 prevented a steeper drop in visitors when the bailed-out economy needs them most. Russia is now the island's second largest tourist market (608,581) behind first place Britain (891,233). Although tourist arrivals are down, €1.95 billion revenue for 2013 in the first ten months has surpassed total tourism income for 2012. Full year tourism income for 2013 will be announced.

In December alone arrivals fractionally increased 0.1% to 54,813 from 54,772 in the same month of 2012. It was only the third month in positive territory for 2013. Last month there were fewer holidaymakers from mainstay countries Greece (7,577) plunging 16.3% and Russia (5,664) down 9.1% compared to the previous year. There was resurgence in British tourists in December increasing 1.6% from 16,847 to 17,115 in December 2013. Arrivals in 2012 increased 3% reaching 2.46 million visitors from 2.39 million for 2011. The last time arrivals to the recession-hit holiday island surpassed this figure was in 2005 when 2.47 million people visited.

Last year annual tourism revenue rose to its highest figure since 2002 reaching €1.92 billion from €1.74 billion despite the financial crisis. Holidaymakers to Cyprus hit a record high of 2.69 million in 2001 spending a record €2.17 billion. Income from tourism accounts for around 12% of Cyprus' GDP.

Source: InCyprus

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