Egypt tourism: Decline much larger than government reports

Egypt’s better-than-expected tourism results for 2011 have been met with disbelief by many in the industry.

Official results showed 2011 tourism revenues fell by a third compared to 2010, but workers and company owners report a much larger drop in business volume due to ongoing political and social unrest in the country.

“The figures don’t reflect reality,” Reda Dawood, owner of the Lucky Tours tourist agency told Ahram Online. “The ministry does not aggregate figures from the industry but from the border authority.”

Egypt’s minister of tourism announced on Sunday that the number of tourist arrivals in 2011 fell by an annual 33 per cent to just over 9.5 million.

“If I just take my company as an example, I’ve seen a drop in customers of close to 90 per cent and other companies have seen similar plunges,” Dawood explained.

Reda’s company deals mainly with Turkish tourists who focus on the Red Sea beach resorts, Luxor and Aswan.

The number of tourists visiting Egypt is aggregated from the number of non-Egyptians entering Egypt and spending more than 24 hours inside the country. Obviously, this number does not differentiate between visitors who benefit the tourism industry and those visiting the country for other purposes.

Ehab Moussa, head of the tourism support coalition, concurs with Dawood’s assessment. “How can we consider more than half a million Libyans fleeing war to be tourists? Not to mention the Sudanese or Palestinians.”

Moussa estimates that removing Libyans from the figures would see the fall in visitors deepen to some 45 per cent, instead of the announced 33 per cent.

The numbers of Libyans visiting Egypt in 2011 surged 13 per cent, or 500,000, according to Sami Mahmoud, head of international tourism at the tourism ministry.

Visitors from Palestine increased by a third to reach 225,000 due to the partial opening of the Rafah crossing and the subsequent influx of travellers from the Gaza Strip. The number of Sudanese visitors increased by 6 per cent.

“What is the problem in considering Libyans tourists?” asked Tourism Minister Mounir Abdel Nour. “They filled hotels in Alexandria during the first half of the year, ate at the city’s restaurants and spent time at its parks; why shouldn’t they be considered tourists?”

Egypt’s once burgeoning tourism industry has suffered a severe blow due to unrest that followed the popular uprising that began in January 2011 and unseated long-time president Hosni Mubarak.

During the last quarter of 2011, Abdel Nour indicated, tourism was hit by deadly unrest in the heart of Cairo.

Tourists from Europe, who comprise the largest group of visitors to Egypt, dropped by 35 per cent to 7.2 million, versus 11.1 million in 2010. Russians remained the top visitors to Egypt with 1.8 million tourists, followed by the UK and Germany.

“All those working in the tourism sector faced difficulties in 2011,” Abdel Nour explained. “Anyone who sees their income drop by a third will face a crisis.”

The minister, who has held office since the mass protests began on 25 January 2011, said that businesses in the sector might not feel the effect of the 9.8 million tourists who visited Egypt in 2011 because of their geographical distribution.

“Cairo, Luxor and Aswan were the cities most affected by the unrest. Other destinations on the Red Sea were less affected.”

Abdel Nour explained some companies are larger in size and consequently were more able to weather the crisis. “This is called structural distribution,” he said.

Apart from possible distortions in the figures caused by the influx of Arabs to Egypt, some industry observers say price reductions and special offers helped attract visitors.

The 2011 Travel and Tourism Competitiveness Report indicates Egypt benefits from competitive hotel prices, low fuel costs, and low prices more generally. The country is ranked fifth worldwide in terms of price competitiveness.

Mahmoud explains this in terms of tourist spending, which dropped from an average of $85 per day in 2010 to $72 in 2011.

Such a drop led to a decline in revenues for the industry, which were $8 billion, down from $12 billion the previous year.

Tourism is one of Egypt’s main foreign currency earners, along with remittances from Egyptians living abroad and Suez Canal revenues.

The drop in tourism returns was reflected in the nation’s finances, which saw half of its foreign currency reserves wiped out in 2011 to reach $18 billion in December.