With Egypt’s convenient location, year-round sun, beaches and heritage, the nation’s tourism has always been one of the prime generators of liquidity.
Maintaining the influx of tourists and increasing their rate of return is a challenge the country is eager to face.
For decades, Europeans have flooded the various Red Sea resorts and expressed a wide interest in Cairo and Upper Egypt’s archaeological heritage. The influx of Arab tourists during the summer season has not only increased hotel bookings, but also the purchasing power in foreign currency. Tourism revenues account for nearly 7 percent of Egypt’s Gross Domestic Product (GDP), 40 percent of the country’s service exports and 19.3 percent of foreign currency.
The Ministry of Tourism has announced an ambitious plan to increase the number of tourists to 18 million visitors a year by 2010. In 2006, Egypt received 9.7 million tourists who spent LE 40 billion, a 13 percent increase over the previous year.
With the increasing competition from other Arab countries, such as the UAE and Morocco, it has become mandatory to preserve Egypt’s attractiveness and develop the infrastructure that will accomodate the increase in arrivals.
“One of the weaknesses in Egypt’s tourism strategy that must be addressed is the focus on increasing the number of tourists by offering cheap packages and poor services, Elhamy El-Zayat, chairman of Emeco Travel, told Daily News Egypt.
These packages result in complaints of poor service, pushy traders and poor standards, which consequently lead to low tourist return rates. In 2006, the ministry issued a report saying the number of tourists returning to Egypt – an important indicator of tourist satisfaction – was a dismal 20 percent.
As a result, the ministry has decided to deliver educational programs through a combination of online courses, aimed at furthering the development of Egyptian industry professionals. This program is targeted at a select group of 40 general managers of full-service three- to five-star hotels, and focuses on strategic hospitality management and financial management. Other programs aimed at training the industry’s workers – hotels’ and restaurant staff, drivers of tourist buses, etc – are also in the plans.
To meet the increase in numbers of tourists, Egypt must invest in upgrading its infrastructure. An extra 15,000 hotel rooms will be needed annually, with investments of about LE6 billion. This expansion will no doubt necessitate the active participation of the private sector.
“The expansion is indeed taking place, through private sector companies that have established full-fledged resorts in places likes Hurghada, Sahl Hasheesh and Ain Sokhna, El-Zayat said. Although establishing hotels inside Cairo could be more difficult due to the congestion and lack of space, several foreign investors have taken the initiative.
Catering to more visitors will entail more than building hotels. Improving the quality of existing airports and increasing their capacity to receive more flights is another challenge.
Analysts have long called for the liberalization of the aviation industry and its policies to realize its true potential. “As a result of the intense competition between tourism destinations worldwide, easy access – and, therefore, efficient air transport – has become increasingly important to tourists deciding which destination to choose, a World Tourism and Travel Council (WTTC) report about aviation in Egypt said.
The report suggested that liberating the aviation industry and ending the monopoly of Egypt Air, Egypt s only national carrier, could help increase international arrivals by 2 million annually. The WTTC called for immediate changes, such as allowing flag carriers to operate more flights to Cairo and the region, allow more international charter flights and ending restrictions on privately owned Egyptian airlines.
While it might not have conformed with all the WTTC’s recommendations, Egypt has taken steps to improve aviation services. The building of a third terminal at the Cairo International Airport is currently in process and following its completion at the end of 2008, it should increase the airport’s capacity by 11 million passengers annually. The Sharm El-Sheikh, Hurghada, Luxor, Aswan and Abu Simbel airports have also been upgraded.
Still, there s more work to be done for the nation s tourism sector to really take off.
