Egypt: Tourism targets

Despite being badly shaken by the 2011 revolution and its aftermath, Egypt’s tourism sector achieved a significant recovery in 2012. In an effort to sustain the industry, Egypt has identified a number of priorities for the short-term, including intensified promotion efforts, improved connectivity, enhanced services and the establishment of new source markets.

Initial figures suggest the country welcomed around 11.5m foreign tourists in 2012, up 17% on 2011, generating income of $9.9bn, a 13% increase over the previous year. Hisham Zaazou, the minister of tourism, told OBG that tourist spend per night rose to around $75 in 2012 from $69 in 2011. However, visitor numbers remained well below the 14.5m achieved in 2010, when per-night spend was $85. Nonetheless, the fact that Egypt attracted nearly 10m tourists even in 2011 is testament to the resilience of the industry. The unrest did not affect most of the country, particularly not its Red Sea resorts.

Zaazou is optimistic about continued growth in 2013, as long as stability can be maintained. He told OBG he expects visitor numbers to rise, when tourists who had postponed trips to Egypt arrive. While the sector was hit particularly hard by the revolution, it also has a history of rebounding quickly from setbacks. “The government will proceed with its aggressive promotion campaign,” the minister said. “I think the tourism industry is very resilient, and its response is very fast.”

Promotional efforts to restore the country’s reputation include close work with tour operators in major markets, as well as their domestic counterparts. Among the plans are marketing through international events and bringing in media representatives to demonstrate that the country is safe.

While the short-term goal of restoring Egypt’s image as a safe place to visit is a priority, the ministry is not losing track of its longer-term strategy of bringing more visitors from emerging markets, from which an increasing number of tourists are travelling every year. “The new markets we are thinking about fall into two camps: the Far Eastern markets, such as China, South-east Asia, India and Malaysia; and in the Western Hemisphere, Latin America,” said Zaazou.

The Ministry of Tourism is also working with Egypt Air, the state-owned flag-carrier, and Turkish Airlines, which has established a large international network, to enhance connectivity to Egypt from Asia and elsewhere in the world. For example, flight frequencies to Japan have increased, and Zaazou is negotiating for more regular connections with Chinese cities, as well as Seoul in South Korea.

“If we make good campaigns but the mode of transport is not there, we will never realise demand,” said Zaazou. “So we are working very closely with the Ministry of Aviation, as well as with three categories of air transport companies: legacy or regular airlines; charter operations; and low-cost airlines.”

The minister said that although the drop in value of Egypt’s currency was causing economic difficulties, it did make the country cheaper for foreign visitors. The pound has fallen – to around LE6.79 to the dollar in mid-March, from just over LE5.5 before the revolution in early 2011 – though it has not plunged as far as some had feared.

The tourism sector is a major earner for Egypt, and thus its health will be an important factor in broader economic recovery. According to the World Tourism & Travel Council (WTTC), travel and tourism directly contributed 6.7% of GDP in 2011. The organisation estimates the industry’s broader impact on the economy – direct, indirect and induced – is worth more than twice that amount, at around 14.8% of GDP. The WTTC forecasts the travel and tourism industry will grow by an annual average of 4.6% between 2012 and 2022, with its wider economic impact rising by 4.8%.