Greeks rely on tourism to beat recession

As to the third year of recession, the Greek State is based on tourism to boost economy and create jobs for the growing number of unemployed.

The Greek Government made major efforts to improve tourism to attract more low-cost airlines and cruise ships to relax legislation to improve the country’s promotion campaign carried out abroad.

The government promised to reduce VAT on hotels at 6.5%, 11%, which is an attempt to make the country more competitive against rival tourist destinations, even in a time when the government is forced to cut expenses incurred other sectors to reduce its budget deficit.
“The period of crisis has become a lesson for us,” said Pavlos Geroulanos, culture and tourism minister. “Current conditions are favorable to turn the situation to our advantage next year.”

Greece are in the first twenty favorite destination among tourists, accounting for 14.9 million visitors last year. The tourism sector is responsible for about 15% of GDP and provides one in five jobs, according to Tourism Employers Association of Greece.

However, the recession has shaken the Greek tourism. Preferred first Europeans, most of them in Britain and Germany, Greece during the last two years an increasing number of tourists decreased, they chose the cheapest holiday destinations such as Turkey or Egypt.

Athens repeated protests, which culminated in May with a violent demonstration resulted in three deaths, caused 30,000 tourists to cancel trips to Greece. By some estimates, at least 3,000 hotels, about one third of the total, have a disastrous financial situation, and thousands of tourism jobs disappeared. Reviving tourism will be difficult. “How that will develop the tourism sector in 2011 will be very important, it depends on national economic growth,” said Nikos Magginas, an economist at National Bank of Greece.

The early signs are favorable. Difficult conditions have led to entrepreneurs in the tourism industry to cut prices to attract customers. Thus, booking in advance, ie 10% of total bookings for summer holidays, increased slightly. “Greece is relatively inexpensive, unlike other European countries,” said Choo JEY Serna, a young man of 23 years in Malaysia, who for the first time in Greece. “Of course, I thought that personal safety would be a problem, but once you’re here, I find a quiet and safe.” Andreas Andreadis, President of Federation of Hotels in Greece, says the hotel market is in slightly better shape than last year and predicted growth of a single digit bookings. “Our prices are currently very attractive and it certainly means a better deal for tourists.”

Even so, the Greek tourism is still encounters some obstacles in its development, caused by an image that already sells a brand of country shabby. Elements such as sun, sea or Byzantine monuments are no longer enough to attract tourists.

“We aim we set presence throughout the country to tourists throughout the year, not only during the summer,” said Geroulanos. “Amid competition from cheaper destinations such as Turkey or Egypt, last year was difficult for many hotels in Greece. The sun and the sea can be found in many countries of interest.”

Therefore, to differentiate from the competition and attract tourists and during the season, Minister of Tourism has developed a marketing campaign, in pursuit of events throughout the year, not only during summer. A concrete example is the Athens marathon, held in November. It also tries to attract tourists from new areas like China and Russia, using the Internet and social networks to promote consolidation.

Plan Geroulanos thought was appreciated by people in the industry, being perceived as a successful attempt to cooperate with them.

Efforts to reduce the VAT and the hotels were appreciated by officials, was among the objectives of the time, as rival destinations already had a rate between 5 and 9%.

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