By Jean Christou
E.U. ACCESSION will not necessarily be a bed of roses for Cyprus tourism, and other issues will have a far greater impact on the future course of the industry, a leading British travel expert has warned.
“It is important but there are more important things. There is too much emphasis on the EU and what it might bring,” said Michael East, managing director of Eastcastle Management Group.
East was speaking on Friday at the annual conference of the UK-based Association of Greek Cypriot Travel Agents (AGTA) in Limassol following a presentation by senior Cyprus Tourism Organisation (CTO) official Phoebe Katsouris.
Outlining the positive and negative aspects of accession, Katsouris said Cyprus expected increased demand, being a member of a 25-nation bloc of some 600 million inhabitants. The EU already accounts for 87 per cent of tourist traffic to Cyprus, she pointed out.
“The process of enlargement might give publicity and awareness of Cyprus,” she said, and the abolition of all travel formalities would certainly help. She also said the introduction of the euro would make trips easier and more attractive.
Another opportunity would come through air transport liberalisation with lower of fares and the possibility of no-frills airlines including Cyprus in their routes. “Investment by foreigners is also expected to increase,” she said. “Cyprus will still have comparatively low taxation and there will also be opportunities for Cypriots to invest and do business in the EU, while EU citizens will be able to work seasonally or otherwise in Cyprus.
She admitted that the downside of accession would include fierce competition, stricter consumer and health controls, price increases on fuel, electricity and airport charges — “and our pricing rates already high,” she warned.
But the biggest headache for the CTO and the Cyprus government will be the prohibition on subsidies to the industry, Katsouris said.
“New legislation on state aid only allows subsidies that do not affect competition, so the CTO has to abandon current ways to help tourism partners and find new ways to help them, which will be allowed,” she said.
“It’s considered so important (in Brussels) that there is no scope for relaxation or grace periods,” she said, adding the EU had “even wanted it done two years before accession”.
“There is no way out of it. We must redefine CTO and government intervention and find indirect ways of helping without violating the law. Priorities in Brussels will define developments in Cyprus tourism.”
But East did not fully agree. “The future of Cyprus will be decided in Cyprus, not in Brussels,” he said.
“The bigger issue for Cyprus over the next five years is that it’s moving away from being a special cultural Middle East destination. Yes, it will be a high quality product, but you can find that anywhere. I can buy Florida in July for the same price as I can buy Cyprus, and Majorca is 20 per cent cheaper. And it’s difficult to understand the difference.”
East said tourism would not be affected much by EU entry and cited Spain and Greece as two good examples. “There is no evidence of major changes in people’s perceptions and there is no real evidence of say Germans going to Spain because of its membership,” he said.
“The biggest change in Europe is in cross-border traffic and that has a lot to do with shopping.”
For Cyprus, he said the biggest change would be in home ownership. “Twenty per cent of the population of Majorca is now German, and they have declared themselves a minority so the new business out of Europe is not primarily more tourists,” East said.
The euro would also be an issue, he said, pointing out that it would still be a foreign currency for the UK, Cyprus biggest tourist market.
“It is a friendly alternative and it helps, but it also hinders,” East said. “First, prices will be rounded up, and it also means tourists are more easily able to compare prices. (Being an EU country) is easier to sell but it’s also price driven. Being seen as an EU beach is good, but it means you will be compared with other European beaches so the EU will bring benefits but also challenges.”
Katsouris said Brussels was now discussing the possibility of a common tourism policy.
She said that by 2020, Europe, which receives 60 per cent of the world’s tourism, would have its share reduced to 45 per cent. “Now there are seven European destinations in the world’s top ten but by 2020 there will only be three. Germany, Austria and Greece will no longer be on the list,” she said. “Brussels is gradually realising this and is looking into it more thoroughly and there is a commitment now to ask the industry to assess the impact of all new legislation.”
Village project shows the way
NEGLECTED and forgotten Cypriot villages are being given a boost under a pilot project funded by Britain’s four largest tour operators and the British government, AGTA vice-chairman Noel Josephides announced at the conference.
He said the Travel Foundation had been set up with an initial investment £50,000 each from the big four operators and the remainder of the total £325,000 from the British government.
Jospehides said that with the contribution of other tour operators in the UK and possibly a voluntary contribution of around £1 from tourists added to their holiday package, the fund could become a multi-million foundation to aid sustainable tourism at destinations all over Europe.
“Cyprus has been chosen for a six-month pilot project,” he said.
The scheme came into operation in Cyprus two weeks ago in the Paphos area, with groups of tourists being taken to the tiny village of Spilia. There they can see how local bread and olive oil are made, buy local produce, have lunch and visit the village’s 16th century church. The trip also includes a visit to Troodos forest park centre and part of the £26 excursion fee is donated to the centre.
The aim is to give an insight into the real Cyprus and eventually make the excursions commercially viable, and the next step is to add such villages in other districts to the tourist map.
“Cyprus is not as pretty now as it was 15 years ago,” Josephides said. “Paphos was a provincial town. Now it’s just a collection of developers` blocks. The island is beginning to look different and operators have to adjust to that. Consumers are now demanding far more than beach and cheap price. Tourists want to see a pretty place. We are selling a dream so if we take it at a very basic level we should do something.”
He urged those in the tourism industry to “stand back and take a look at your resort with fresh eyes because that’s what the client sees”.
“We seem to be trying to create a quality destination in a two-star environment,” he said.
The Cyprus Mail is the only English-language daily newspaper published in Cyprus. It was established in 1945 and today, with its popular and widely-read website, the Cyprus Mail is among the most trusted news sites in Cyprus. The newspaper is not affiliated with any political parties and has always striven to maintain its independence. Over the past 70-plus years, the Cyprus Mail, with a small dedicated team, has covered momentous events in Cyprus’ modern history, chronicling the last gasps of British colonial rule, Cyprus’ truncated independence, the coup and Turkish invasion, and the decades of negotiations to stitch the divided island back together, plus a myriad of scandals, murders, and human interests stories that capture the island and its -people. Observers describe it as politically conservative.
