£43 million to promote tourism

THE CYPRUS Tourism Organisation (CTO) will need some £43 million from the state for 2008, which is expected to be a difficult year for tourism, the House Finance Committee heard yesterday.

The CTO brings in £3.5 million a year from its own sources, but must still be financed by the state due to the importance of tourism to the economy, although its precious 20 per cent contribution to GDP has fallen to around 13 per cent in recent years.

Revenue from tourism up to the end of September this year was £897 million compared to £838 million in 2006, an increase of 7.0 per cent. At the beginning of the decade revenue went over £1 billion for the first time ever.

CTO chairman Panos Englezos told the Finance Committee that the first half of 2007 had been extremely difficult for tourism. Numbers were falling continually up until Jul and August. But he added that with aggressive marketing, the year looks like it will end with a marginal 1.1 per cent increase over 2006. This translates into around 2.4 million visitors.

Englezos said problems exist in the British and German market, which dropped steadily this year, but Russia, Sweden and Greece have shown significant increases.

The CTO chairman also commented on tourism to the north, saying it could emerge as a new competitor but until had not affected the market.
“We have managed to make agreements that keep occupied Cyprus out of the brochures of the big travel agents,” he said.

“Of course, the situation is of concern to us and we are watching matters carefully.”

In justifying the CTO’s budget, Engelzos said that Cyprus needed to be protected from external factors and global changes, economic and political. This would require a substantial advertising budget to promote the island.

“Next year will be a pivotal year in the efforts of the CTO to make concrete its revised strategy for tourism with an eye on 2010,” he said.