May 25, 2012 / 3:14 PM / in 6 years

Turmoil weighs on Greek tourist industry

ATHENS (Reuters) - Significantly fewer German and British tourists visited Greece in the early months of 2012, the central bank said on Friday, kept away by the political turmoil that prompted one foreign holiday operator to delay payments on hotel bookings.

In further bad news for an economy mired in its fifth year of recession and struggling with record unemployment, visitor receipts fell 15.1 percent year on year in the first quarter.

Tourism is a key sector for Greece’s 215-billion-euro economy with visits to the country’s sun-drenched islands and ancient ruins accounting for about 15 percent of total output and one in five jobs.

A hoped-for upsurge in arrivals would help offset the economic gloom, but strikes and sporadic riots in central Athens have spooked visitors, and an inconclusive general election earlier this month prompted others to put off travel plans due to fears Greece might be pushed out of the euro zone.

Italian tour operator Veratour said on Friday that, pending the outcome of a second election scheduled for June 17, it was seeking to delay payments on summer bookings with its Greek hotel partners.

“We’ve asked for some time, a bit of patience, until the situation is clear,” Stefano Pompili, marketing chief at the Italian company told Reuters.

He said Veratour had put down an advance of up to 40 percent on its contracts, but wanted to hold off on further payments because of the political and economic uncertainty.

The head of Greece’s main hotel association, the Hellenic Chamber of Hotels, said Veratour’s decision was the first by a tour operator this year. He did not expect others to follow.

“I believe our long-term partners will honour their agreements and will not try to benefit at the expense of so many Greek tourist companies and their clients who look forward to spending their holidays in Greece,” George Tsakiris said.


The Bank of Greece said receipts from Russian and German visitors were down by 41 and 7.9 percent respectively in the first quarter, while those from British travellers - the country’s second-biggest tourism market after Germany - fell 11 percent.

“The data confirms that it will be a difficult year for the tourism sector. Recession in the euro zone and high uncertainty in Greece are having a negative impact,” said National Bank economist Nikos Magginas.

“The trend will probably worsen in the second quarter, so hopes for stabilisation are pushed back for after July,” he said.

Overall, the sector’s balance of payments showed a deficit of 28.5 million euros in the first quarter, down by 35.4 million year-on-year as Greeks also cut down on travel abroad.

The Bank of Greece said total travel receipts declined to 396 million euros with visitors spending an average of 405 euros per trip, down 3.8 percent from the same period in 2011.

The number of travellers visiting Greece, which remains at the centre of the euro zone’s debt crisis despite two bailouts, fell 11.7 percent in the first three months of the year to 978,600.

Tourism receipts from European Union visitors fell 28 percent year-on-year, while revenue from non-EU travellers was down 9.5 percent.

The Bank of Greece said revenue from Russian visitors fell 41 percent from the same period a year earlier.

Reporting by George Georgiopoulos, Maria Paravantes and Deepa Babington; Editing by John Stonestreet

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