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This year’s celebrations marking World Tourism Day could not have come at a worse time for Cyprus, as well as other rival destinations where the economy relies heavily on the leisure sector and related services.
The collapse of Thomas Cook, with its implications on Cyprus, is reminiscent of other “too big to fail” scenarios in recent years, with little learnt from past mistakes of putting all our eggs in one basket.
Wiping out a chunk of arrivals from the UK, with a chain reaction affecting other destinations, it is no wonder that rating agencies have once again placed Cyprus banks on a watch list, for a possible downgrade if the fallout from the travel giant’s failure gets any bigger.
Then again, although the impact on hoteliers could be manageable, as they are owed only two months of bookings, the problem is not for this year, as much as for next year, as the three-year continuous record growth came to a halt and projections for 2020 could be gloomy.
Rating agencies warned months ago about an impending collapse of the company, yet little precaution was taken to soften the blow.
With one in ten persons in the labour force involved in the tourism industry, all stakeholders in Cyprus should brace for troubled days ahead, as no matter how big a miracle, the vacuum created by the 6% shortfall in Thomas Cook arrivals cannot be replaced so quickly.
Worse still, after the collapse of Cobalt, airfares have also gone through the roof as demand has increased and supply has shrunk, with the pie not growing.
This year’s World Tourism Day highlighted labour as its main theme, focusing on what could provide a better future for those employed in the sector and those hoping to join it.
The creation of jobs is important, as the construction ‘boom’ driven by the investments-for-passports scheme is also expected to slow down, which leaves us with the need to come up with smarter jobs, providing quality services and improving our infrastructure.
The latter being a non-starter as road projects and so much more have been left on the back burner because increased state revenues have gone to satisfy payrolls and not to invest in the future.
Perhaps, now that another major tour operator and its related air carriers have failed, the 35-euro subsidy that everybody knows of but never acknowledges, ought to be directed to other areas, such as improving land, sea and air transport, allowing for widespread digital services and helping to lower fixed costs, such as fuel and electricity, which will in turn cut the cost of doing business and make Cyprus competitive again.
This is a time for serious recollection where we cannot afford haphazard demands put forward by trade unions, that are pushing for higher pay, while ignoring the need for quality services at the hotel reception, on a public beach, at the airports and even in civil service.
We need the right people in the right places, regardless if they are grumpy natives or smiling ‘foreigners’ who are more than glad to do the jobs that locals frown upon.
After all, bad employers who abuse workers’ rights are very often punished by market forces, as consumers vote with their feet and never return, while good employers are rewarded with repeat holidaymakers, some of whom have been returning for many years and have earned the title of ‘honorary tourist ambassadors’.
