Cairo – Tourism in Egypt is starting to recover after a phase of decline during the financial crisis of 2009. "The evidences are showing that the flow of tourists travelling to Egypt has returned to growth in early 2010", explained Omayma El- Husseini, a spokesperson for the Ministry of Tourism of Egypt. According to her, last year’s tendencies were reverted to a return to growth, and this should continue.
According to the Ministry of Tourism report, published last week, sector revenues rose 24% in the first quarter of 2010. The estimate is for them to reach US$ 2.7 billion from January to the month of March. According to the same document, arrivals have also grown 29%. The number of tourists visiting the country in the period was 3.46 million.
According to Omayma El-Husseini, the figures for the first quarter were within expectations. And expectations of the Ministry of Tourism of Egypt are that the same should be repeated in the next quarter.
According to her, the recovery of the tourist flow may be attributed to the effects of the economic crisis and to growth of the buying power in the countries affected. “However, the government of Egypt is also contributing to the improvement of conditions for the sector, establishing a series of measures geared at stimulation,” said Omayma.
According to her, in an attempt to contain the decline in the number of visitors, the government has approved the establishment of several charter flights, connecting countries in the Mediterranean to the coastal cities of the Red Sea, like Urghada, Sharm El Sheikh and Luxor. The Ministry of Tourism also decided to support travel operators, promising to reinvest tourism dollars in advertising in several parts of the world.
Omayma explains that the government of Egypt met with representatives of the travel sector in late 2008 to adopt measures to boost visits, among them free meals and the establishment of cheaper and attractive tourist packages. "The measures seem to be generating results,” said Omayma.
Below expectations
Despite the positive results of the measures taken, analysts like the senior analyst of Beltone Financial Bank, Reham El Dessouki, show the fact that the level of revenues obtained during the first quarter of 2010 are still slightly below expectations. “The figures expected for the first quarter of this year were US$ 2.8 billion,” said Reham. According to her, expectations forecasted by Beltone Financial for the 2009/2010 fiscal year were for revenues of US$ 11.5 billion.
The senior analyst of investment bank EFG – Hermes, Mohamed Abu Basha, in turn, forecasted US$ 2.5 billion for the first quarter of 2010, so the figures were slightly higher than those estimated by the organisation.
"The travel sector has shown a strong capacity for recovery and for this reason we believe that it will have a central position in the recovery of the Egyptian economy as a whole,” said Abu Basha. "Global revenues should continue rising gradually, as the effects of the global crisis are dissipated,” said El Dessouki.
How about the volcano?
With tourism as one of the main sources of revenues for Egypt – together with Suez Canal and the transfer of funds by expatriates –, improvement in the sector performance is immediately noticed in the economy as a whole.
But, according to most analysts, the sector should still face the consequences of the recent eruption of Icelandic volcano Eyjafjallajokull, which produced disastrous effects in air traffic in Egypt and Europe for over a week. "The recent happenings in Europe will certainly have an impact on other regions of the world like the Middle East,” said Mahmoud Mohsen, travel operator in Cairo.
According to him, anxiety has been growing with the news that a second volcano, Katla, close to the first one to erupt, is threatening to go off. "If that takes place, tourist revenues forecasted for the second half of 2010 will be greatly affected by temporary interruptions of air traffic,” he finished off.
*Translated by Mark Ament
