It is a great pleasure to be here and have the opportunity to address the FVW Congress.
The success story of our industry is widely acknowledged. In spite of the crisis, and even in the midst of it, the Greek tourism sector has continued to achieve its targets and support the Greek Economy both in financial and social terms. Indeed last year, tourism proved to be the key driver of economic growth in our country. Our sector continues to be one of the leading contributors to GDP and – in a year that the country welcomed a record 17.9 million international visitors who accounted for 12.2 billion euros in direct receipts – it is no coincidence that, in 2013, Greece posted a primary budget surplus for the first time in a decade. Going forward, the Greek Tourism Confederation has just revised its 2014 international arrivals target – from 18.5 million to 19.5 million; for a total of 21.5 million if we count cruise ship visitors. We also anticipate that total tourism revenue may well exceed 13.5 billion Euros this year.
At this point I should highlight the fact that one of the key reasons for this impressive increase in international arrivals is the growth seen in the German market. This year we are anticipating a record year in terms of German arrivals, totalling almost 2.8 million, up significantly from previous years.
Ladies and Gentlemen,
My opinion is that this is not a case of a couple of one-off, successful years for our industry. Greece’s tourism industry has evolved into a key, stable pillar of the Greek recovery story. Greece is one of the world’s leading travel destinations, combining a wealth of natural beauty, sea and sun, cultural heritage and a diverse array of unique experiences ranging from culinary tours to spa and wellness treatments. Our country’s tourism enterprises offer rates and packages that are excellent value for money. Keen interest from major airlines and improved air connections, in addition to far more diverse distribution networks for our tourism product, have already brought results in terms of significantly extending the tourism season (ie April to June air arrivals excluding Athens numbered 3.6 million in 2014, compared to 2.8 million in 2010), as well as substantial growth in visitor expenditure.
Furthermore, if we compare international arrivals figures with those of our major competitors – Spain, Croatia, France, Italy and Turkey – we see that Greece has gained market share, with an increase of at least 15% for a second consecutive year. The Bank of Greece recently announced preliminary figures for July arrivals, which indicate phenomenal growth for that month – almost 30%, with overall growth of 20% for the first seven months of the year.
The stabilisation of Greece’s economy has contributed to ensuring that the country is, once again, projecting a positive image abroad. Furthermore, Greece has an excellent online reputation ranking, particularly when compared with competing destinations. The Greek Tourism Confederation has signed a strategic partnership with ReviewPro, whose online reputation management analytics provide critical insight into overall guest satisfaction levels for all of the confederation’s member hotels as well as strengths and weaknesses across a variety of departments, The initial results – from January through August – indicate that Greece enjoys an overall satisfaction rate of 84.1%, compared to an average 81% seen in our competitors. Along with providing an overall ranking, ReviewPro also measures specific elements such as value for money, location, service quality and food and drink provision.
As the newest Social Partner of the Greek Government, from early on we developed a strategic roadmap for tourism with a view to 2021. According to the roadmap, we anticipate strong, stable and sustainable growth. Our goal is to attract 22 to 24 million international visitors and generate 19 billion Euros in direct revenue by 2021. This increase in visitor numbers and revenue would add 9 points to GDP and result in the creation of another 300,000 jobs, for a total of 1 million.
According to the roadmap, in order to achieve these figures by 2021, we must invest 3.3 billion euros annually in the tourism sector. There is an immediate need to create 150,000 new hotel beds and upgrade another 100,000 in the 4* and 5* categories. Moreover, we must invest in infrastructure that will pave the way for attracting affluent, experienced travellers with greater spending power.
Ladies and Gentlemen,
For the next couple of minutes, I would like to highlight some key facts that will provide some context for the discussion to follow.
Arrivals figures are actually growing faster than our 2021 projections. The Greek Tourism Confederation expects that the adjustment of the target from 22 to 24 million arrivals will be achieved earlier than predicted in the 2021 roadmap forecast. More specifically, the figure of 19.5 million-plus arrivals that we are anticipating this year is two to three years ahead of the target in the original plan. Consequently, and in order to ensure the Greek economy capitalises on this accelerated inflow of tourists, a number of critical steps must be implemented to move forward the investments necessary to support and bolster this growth. At our most recent Greek Tourism Confederation General Assembly, the Prime Minister stated that the Tourism industry will be supported with a sum of 500 million euros on an annual basis. A new, more attractive and stable tax law is of paramount importance together with an improved and transparent zoning, land use and coastline regulatory framework. Furthermore, privatisations should be accelerated, chiefly to enable the required infrastructure investments. Regional airport and port privatisation, for example, should be conducted in a manner that will facilitate tourism development and not with the sole objective of maximizing revenue.
A study conducted by SETE Intelligence, SETE’s newly-established intelligence unit, found there to be a 25% increase in scheduled flight seat demand in 2014 compared to 2013. The breakdown of planned incoming air transport capacity at regional airports is as follows: 43% scheduled international flights, 42% chartered flights and 15% domestic flights. Therefore, for the first time, the number of seats on scheduled international flights will surpass the number on chartered international flights. In other words, it appears that airlines are feeling increasingly confident about establishing stable connections with our country due to solid, ever-growing demand.
Aside from our main tourism product which is sea and sun – that, as mentioned previously, requires an investment of an additional 250,000 beds in the 4* and 5* categories – all other tourism products outlined in the 2021 strategic roadmap are attracting greater demand than initially predicted. The City Break product, in particular, is picking up faster than anticipated.
As a result of social unrest in previous years, tourism in Athens had suffered substantially. During that period, international arrivals at Athens airport declined by approximately 850,000. Fortunately, tourism in Athens began to recover in the first half of 2013. This recovery trend strengthened in 2014, and in the first half of the year, international arrivals increased by 400,000 compared to 2013. At the moment, arrivals figures are higher than those of 2009. Given that almost 60% of international travellers visit Athens in the second half of the year, the total annual increase can be expected to surpass 800,000. The fact that all major archaeological sites are now open from 08.00 to 20.00 and shops in the city centre will stay open on certain Sundays will further boost the city break product and the local economy.
Ladies and Gentlemen,
Tourism is one of the few sectors in which revenue is spread widely, both regionally and socially. Tourism-related services are offered by a multitude of businesses and professionals, offering employment to approximately 320,000 people. Taking into account the contribution of tourism to the rest of the economy, the number of employees rises to 700,000. With the front load of arrivals I have described, we anticipate that tourism will create 300,000 new jobs for a total of 1 million jobs ahead of 2021. Furthermore, a significant proportion of the cost of services provided relates to labour services and cost components, such as food, energy and transport, which has considerable domestic added value. Tourism, therefore, contributes substantially to the country’s wider economic development and meets an urgent need for job creation.
In order to implement the road map and steer our sector towards achieving our 2021 targets, in 2013 we launched our two main strategic vehicles, the non-profit organization Marketing Greece and the institute of SETE.
Marketing Greece is a financially independent – that is, privately funded – organization founded by SETE, the Hellenic Chamber of Hotels and the Greek Association of Advertising and Communication Companies. The company serves as the official representative of the Greek tourism industry and aims to effectively showcase Greek destinations and experiences while promoting seamless cooperation between the private and public sectors, the government and local authorities.
When I look at Marketing Greece, I see a company that is able to coordinate private marketing energy, by clustering small- and medium-sized company marketing initiatives. It also assists local communities, particularly the ones whose voices are struggling to be heard, to structure and showcase their tourism potential in a more professional and technologically-advanced way.
Even though the company is still in its first year of operation, I must say that the team is working with incredible speed and efficiency. In a matter of months, they have planned, built and launched our flagship portal www.discovergreece.com
The Institute of SETE – INSETE – has two major strategic axes.Firstly, to develop a thorough and fully functional tourism observatory. The observatory will be capable of analyzing data for our members, the tourism industry, investors and hedge funds seeking information across the full spectrum of tourism. Secondly, INSETE will develop a transparent system of accreditation for tourism professions and the varied tourism products. With the support of INSETE, we will be in a position to further upgrade the quality of Greece’s tourism enterprises and services, enhance the visitor experience and further improve and consolidate our position in the global tourism marketplace.
Ladies and gentlemen,
The next few years will be critical for Greece’s tourism industry. SETE is working towards the implementation of a thorough plan aimed at improving the standards of products and services offered, while investing in education and training, both for those working in the industry and Greek society as a whole. It is our duty to continue to support the Greek economy and ensure a better future for generations to come.
Thank you for your attention.
Dr. Andreas A. Andreadis