Egypt makes strong efforts to lure tourists back

Tuesday, 03 May 2011

The Egyptian government has allocated 200 million Egyptian pounds ($329.5 million) in an effort to lure tourists back into the country. (File photo)

By IKRAM AL-YACOUB
Al Arabiya with Agencies

The Egyptian government has allocated 200 million Egyptian pounds ($329.5 million) in an effort to lure tourists back into the country, a top government official told Gulf News on Tuesday.

The funds will be allotted through incentives to charter operators, marketing campaigns and media familiarization trips from now until October 1, 2011.

The Tourism Fund under the operations of the Ministry of Tourism is financing the scheme, said Hesham Zaazou, First Assistant Minister of Tourism, who was speaking at the sidelines of the Arabian Travel Market on Monday in Dubai.

Following the January revolution that hit Egypt’s tourism industry, the government convened a crisis management meeting to analyze how to stimulate the sector, which is the country’s major economic lifeline, he said.

Egypt lost $1.8 billion in direct tourism revenues between February and April this year, according to a senior Egyptian government official. During that time, the number of tourists entering Egypt declined by 60 percent, Mr. Zaazou said.
Egypt's saw 14 million tourists during the period of January to October last year according to a report in Al-Gomhuria newspaper.

Economists say since the unrest broke out, a decline in tourism, consumption and business activity has hit tax revenues, which make up about 60 percent of Egyptian government’s income. The government has also boosted social spending in response to protestors' demands for jobs and higher wages.

The draft budget due to be presented to the cabinet foresees revenue of 342.6 billion Egyptian pounds ($57.6 billion) and spending of 500.7 billion pounds ($84 billion), Minister of Finance Samir Radwan told Reuters.

Before the unrest, Egypt had predicted a deficit of 7.9 percent of GDP for fiscal 2010/11, but later revised that to between 8.2 to 8.4 percent.

Egypt’s population is 82 million and its per capita income is estimated by the International Monetary Fund to be $6,367.

Planning and International Cooperation Minister Faiza Abu el-Naga announced on Monday a development plan worth 230 billion pounds ($38 billion) to kick-start the economy after former President Hosni Mubarak’s ouster.

Ms. El-Naga that 55 percent of the plan—which still needs to be approved by the government—would come from the private sector while the remainder would come from the public sector.

The ministry will also have a joint marketing campaign budget for travel agents in 17 destinations worldwide as a way to promote Egypt, said Mr. Zaazou. “We will pay one dollar for every dollar they spend,” he said.

He also said that they would extend invitations to personnel in the media and tourism industries to familiarize themselves with Egypt so they can see the situation for themselves “firsthand,” he added.

International hotel chains in Egypt, such as the Hilton, will also participate by hosting free room offers during the familiarization trips.

Hotel occupancy rates improved five-fold in April from the slump in February following the revolution, according to Mr. Zaazou.

In February occupancy rates were 8 percent to 10 percent down in figures from the same period last year.

“We hope to be back to normal by the end of the year… We have monitored a positive effect and upward trend, not up to our aspirations, but it is better than before,” he said.

Asked by Gulf News, if travelers’ fears about insecurity in Egypt were founded, Mr. Zaazou said that while one understands one’s fears of uncertainty about law and order in a country that has undergone major political changes, non-Arabs tend to lump the Middle East into one entity.

“The situation in Egypt is definitely much better than before, and security and safety is much better,” he said.

(Ikram Al-Yacoub of Al Arabiya can be contacted at Ikram.yacoub@mbc.net)