Arab Protests Send Tourists to Europe
Eric Cabanis/AFP/Getty Images
Tour operators in Germany, home to the world’s biggest spenders on international holidays, said summer bookings to the Middle East and North Africa collapsed by as much as 50 percent.
Tour operators in Germany, home to the world’s biggest spenders on international holidays, said summer bookings to the Middle East and North Africa collapsed by as much as 50 percent. Photographer: Eric Cabanis/AFP/Getty Images
Oct. 17 (Bloomberg) — British-born Shaun Mattingley talks with Bloomberg’s Jennifer Freedman about the decision to pospone his family trip to Egypt last February amid the political unrest in the country.
They spoke on Oct. 6 in Divonne, France. (Source: Bloomberg)
Shaun Mattingley began arranging a
tailor-made family holiday to Cairo, Luxor and Aswan five months
before their Feb. 19 departure, eager to show his wife and
daughter “the Egypt I had grown to love over the years.”
They never made it. With Hosni Mubarak’s regime in its
dying days, he canceled the trip two weeks before they were to
fly to Cairo and instead took his family to Spain. Unrest has
cost the Arab world billions of dollars in revenue and chipped
away at the earnings of resorts, hotels and tour companies, such
as Hannover, Germany-based TUI AG (TUI1) and Egyptian Resorts Co. (EGTS)
While the wave of popular upheavals sweeping the Arab world
holds the promise of ushering in greater prosperity and
democracy for millions of people, the unrest has undermined one
of the region’s biggest industries, leaving many economically
worse off now than they were before the protests began.
“We’ll do the trip when the elections are out of the way
and there is stability,” said Mattingley, 46, director of Delta
Community SA, an electronic trading platform in Eysins,
Switzerland, about 26 kilometers (16 miles) north of Geneva.
The Arab Spring has taken a toll on tourism in cash-
strapped nations from Jordan and Egypt to Morocco and Tunisia,
costing the region more than $7 billion, according to the Arab
Tourism Organization in Jeddah, Saudi Arabia. The number of
visitors to North Africa and the Middle East dropped 13 percent
and 11 percent, respectively, in the first half of 2011, said
Taleb Rifai, secretary general of the United Nations World
Tourism Organization in Madrid.
Tourism is the world’s third-largest industry, contributing
$1.2 trillion — or 5.2 percent of the global economy — every
year. The industry is responsible for one in every 12 jobs,
Of the 61 million visitors to the Middle East last year,
more than 14 million went to Egypt, whose pyramids, temples,
Nile cruises and mummies make it the top tourist destination in
the Arab world and No. 18 globally, according to the UN agency.
Egypt, which counts on foreign visitors for 16 percent of
its gross domestic product and 14 percent of jobs, lost 80
percent of revenue in the last holiday season, Tourism Minister
Mounir Fakhry Abdel Nour told Jordan’s Ad Dustour newspaper on
Oct. 1. The government expects tourism revenue to fall to $10
billion this year, from $12.5 billion in 2010.
Travel agencies as well as resorts and hotels in the Middle
East are also feeling the pinch. Egyptian Resorts, a Red Sea
resorts developer, said first-half net income plunged 80
percent, while Orascom Hotels Development, the Cairo-based
unit of Switzerland’s Orascom Development Holding AG, had a
first-quarter loss of 6.1 million Egyptian pounds ($1 million)
compared with a profit of 164.2 million pounds a year earlier.
Tour operators in Germany, home to the world’s biggest
spenders on international holidays, said summer bookings to the
Middle East and North Africa collapsed by as much as 50 percent.
TUI, Europe’s top travel company, said on Aug. 11 that its
third-quarter loss widened as the unrest crimped earnings from
France. London-based Thomas Cook Group Plc (TCG), TUI’s closest rival,
cut its profit forecast a month earlier because of the drop in
travel to North Africa during its peak season, and Kuoni Reisen
Holding AG (KUNN) said the wave of revolts had had a “significant
negative impact on demand in the European tour-operating
“What we see right now is a slow recovery,” said Peter Brun, a spokesman for Zurich-based Kuoni. “People don’t have
confidence yet because there are elections in Egypt and they are
afraid of what will happen there, whether it will be peaceful.”
Egypt’s lower and upper houses of parliament will appoint
an assembly in late March or early April that will rewrite the
constitution. A presidential vote will take place 45 to 60 days
after the results of a constitutional referendum are announced.
Egypt’s economy shrank 4.2 percent in the first quarter as
revenue from industries including tourism plummeted. Gross
domestic product grew 1.8 percent in the fiscal year that ended
on June 30, the weakest performance in at least a decade, the
government said in September. The balance of payments in the
fiscal year recorded a $9.8 billion deficit, compared with a
surplus of $3.4 billion the previous year, and currency reserves
have dropped by a third this year.
Unrest was reignited in central Cairo on Oct. 9, when a
night of clashes between Coptic Christian protesters and the
security forces left at least 25 people dead. Egypt’s economy
has lost $9.8 from protests this year, according to economic
consultant Geopolicity Inc., which said the Arab Spring has cost
countries in the region more than $56 billion, with Libya, Syria
and Tunisia also hard hit.
Morocco, the most popular African destination, derives
almost a fifth of its GDP and 17 percent of employment from
tourism, the London-based World Travel Tourism Council said.
In Tunisia, where the self-immolation of an unemployed 26-year-
old sparked a revolution that led to the ouster of President
Zine El Abidine Ben Ali in January, tourism accounts for 17
percent of GDP and more than 15 percent of jobs.
Tourism revenue in Tunisia has plunged 50 percent this
year, central bank Governor Mustapha Kamel Nabli said on Sept.
21. Tunisia’s current-account deficit, the broadest measure of
trade, will widen to $2.8 billion this year from $2.1 billion in
2010, while Morocco’s will grow to $5.3 billion from $3.9
billion last year, according to the International Monetary Fund.
The loss of income from tourists has hurt millions of
people in Egypt, Morocco, Tunisia and Jordan — a region where
20 percent of the population lives in poverty, according to the
World Bank — and situation may not improve any time soon.
Egypt’s Tourism Ministry said it’s unable to predict when
foreign visitors will return.
‘For the Better’
“We’ll probably starve for a while, since tips from
tourists are my family’s only source of income,” Ahmed, a tour
guide in the Hatshepsut Temple in Luxor, said in February, less
than two weeks after protests toppled Mubarak. “This may even
go on for a whole year, but we don’t care. It’s for the better,
and for the future of my baby girl.”
In Jordan, which has enjoyed relative calm compared with
other Arab nations, tourism revenue dropped 12 percent in the
first half of 2011 from a year earlier as travelers put off
trips to see the ancient ruins at Petra, with its spectacular
temples and tombs hewn from rose-colored rock that were featured
in the film “Indiana Jones and the Last Crusade,” and the
windswept peak of Mount Nebo, where according to ancient
tradition, Moses was given a view of the promised land.
Tourism contributes 14 percent to Jordan’s economy and,
along with remittances from nationals working abroad, is the top
source of hard currency in the kingdom of 6.5 million people.
International arrivals in Lebanon fell 24 percent in the
first eight months of 2011 as instability in neighboring Syria
deterred visitors who journey by car through the only open
Lebanese border crossing. Lebanon relies on tourism for almost
34 percent of its GDP and 32 percent of jobs, according to the
World Travel Tourism Council.
The drop in tourism in the Arab world has been good news
for struggling European economies, which need every fillip they
can get. Foreign visitors have flocked this year to Greece and
Portugal, both recipients of international bailouts, as well as
to Spain and Turkey.
Israeli tourism held up during the unrest elsewhere in the
region, though there were cancellations among travelers who had
booked packaged tours that combined Israel with stops in Egypt
The number of foreigners who journeyed to Spain hit a
record 7.64 million in August, the government said, while data
from Portugal show its hotel revenue climbed 12.5 percent in
July. The number of travelers to Israel who stayed more than one
night rose 3 percent to 2.1 million in the first nine months.
‘Great’ for Turkey
Foreign tourist arrivals in Turkey jumped an average of 20
percent in the first four months of the year and reached a
record 4.6 million in July, according to figures from the
Ankara-based Tourism Ministry.
“We have had a great season and it looks as if it’s going
to prove a longer season, too, perhaps extending into
November,” said Secim Aydin, deputy president of the Turkish
Hotels Federation. “The Arab Spring has hit the whole region,
but Turkey’s stability and safety have drawn in more visitors.”
Spending by visitors to Greece, which is grappling with its
own domestic unrest as the government tries to stave off a
default, climbed more than 14 percent in the first seven months
of 2011, making tourism the nation’s most productive industry.
Tourism accounts for almost 16 percent of Greece’s output and
about one in five jobs, the World Travel Tourism Council said.
“The Arab Spring contributed to a rise in tourists coming
to Greece this year,” Culture and Tourism Minister Pavlos Yeroulanos said in an interview in Athens. “We’re looking at 2
percent to 3 percent of the growth over last year to be a direct
result of the Arab Spring. The challenge is to continue this
growth for the future.”
To contact the reporter on this story:
Jennifer M. Freedman in Geneva at
To contact the editor responsible for this story:
James Hertling at