Key Takeaways
- Turkey's tourism industry has been significantly affected by the earthquake, but hotel owners are optimistic about a gradual recovery as the government has relocated displaced individuals to alternative accommodations.
- The upcoming elections have deterred tourists, but hotel owners are hopeful that the peak summer travel season will lead to a possible return to pre-earthquake travel figures.
- Coastal resorts that were spared from damage offer potential for recovery, particularly with an influx of Russian tourists who are among the few available destinations due to Western sanctions.
- The expected decrease in Russian tourists due to the ongoing conflict with Ukraine could have severe consequences for Turkey's economy, impacting inflation and the currency.
- The Turkish government aims to generate $56 billion in tourism revenues this year and may need to secure up to $20 billion in external funding to support the lira for the remainder of the year.
Following months of accommodating earthquake survivors in his hotels, Hakan Saatcioglu, the coordinator of Limak International Hotels & Resorts, is among many hotel owners who anticipate their establishments will soon welcome tourists.
The government has relocated displaced individuals to alternative accommodations, raising optimism for the revival of Turkey’s crucial tourism sector, which was significantly affected by the devastating quake that claimed over 50,000 lives and left countless individuals homeless.
Gradual Rebound in Tourism
Turkey’s tourism industry has experienced a slow recovery since the catastrophic earthquake on February 6. The government is focusing on tourism revenue to reduce the current account deficit ($48.8 billion last year).
Nevertheless, progress has been sluggish. According to data from ForwardKeys, stays of two nights or more in Istanbul have decreased by 31% compared to 2019.
The decline in new bookings results in lower revenue for travel professionals and the broader economy. Before the earthquake, foreign visitors to Turkey had increased by 80% YoY to 44.56 million in 2022, but the recent disaster has disrupted that growth.
Impact of Upcoming Elections on Tourism
The May 14 elections, which present the most significant political challenge for President Tayyip Erdogan in his twenty-year tenure, have also deterred tourists due to concerns about potential disruptions.
Hotel owners are eager to fill their rooms, but bookings for the first two weeks of May are low. Tourism officials predict a possible return to pre-earthquake travel figures following the elections, particularly as the peak summer travel season in Turkey commences.
The government has relocated displaced individuals to alternative accommodations, raising optimism for the revival of Turkey’s crucial tourism sector, which was significantly affected by the devastating quake that claimed over 50,000 lives and left countless individuals homeless.
Coastal Resorts Offer Potential for Recovery
The earthquake’s epicenter was in the southeastern city of Kahramanmaras, sparing coastal resorts from damage.
This, along with an influx of Russian tourists, offers hope for recovery. In March, foreign arrivals to the popular Mediterranean resort area of Antalya rose by 54% YoY, reaching a record high. Russians topped the list, followed by Germans and Britons.
After facing Western sanctions over its invasion of Ukraine, Turkey remains one of the few destinations available to Russian travelers.
The Turkish government aims to generate $56 billion in tourism revenues this year, and despite the challenges, Ankara is committed to reaching that pre-earthquake target.
Consequences of Reduced Russian Tourist Numbers
The ongoing conflict between Russia and Ukraine has led to an expected significant decrease in Russian tourists visiting Turkey this year.
The Association of Tour Operators of Russia suggests that two million Russian tourists would be a favorable number for 2022, a marked decline compared to the 4.7 million Russians who visited Turkey in 2021.
Economic Ramifications
The drop in tourism revenue, particularly from Russian and Ukrainian tourists, could have severe consequences for Turkey’s economy.
The decline in tourism is projected to impact the Turkish economy even after the season ends, exacerbating the nation’s soaring inflation and floundering currency.
The government may need to secure up to $20 billion in external funding to support the lira for the remainder of the year.
If this amount cannot be obtained, significant currency restrictions might become necessary.
