Turkey hopes to avert big slump in 2015 tourism

By Doug Newhouse |

The Turkish Government is preparing itself for a lower number of tourists this year, based on the well-publicised pressures currently being felt in both Russia and Iran – two key sources of tourists to the country – with Russians traditionally big spenders with both Gebr. Heinemann in Istanbul and Dufry/Nuance in Antalya.

 

Interestingly, the first three months of this year contrasts strongly with the record 2014 performance where tourist arrivals numbered 37m (+5%) for the first time ever.

 

In the first three months of this year, the top three foreign tourist-sourced arrivals by nationality were Germany with 548,083 (representing a 12.1% share of the total), followed by Iran with 435,516 (9.61% share) and Georgia with 336, 883 (7.44%). All other arrivals in the first quarter amounted to 4,530,224.

 

Turkey is of significant importance to the DF&TR industry and to independent operator Gebr. Heinemann in particular, since it is the retailer’s second largest market (after Norway) accounting for sales of €560m ($603m) last year.

 

The operator and its partner Unifree hold a 25-year duty free departures and arrivals concession for the €10bn ($10.7bn) New Istanbul Airport, which is due to supercede the existing facility – a development which Heinemann is understandably excited about.

 

The new Istanbul Airport where the partners of Heinemann and Unifree hold a 25-year contract which they hope to begin in 2017, provided construction and fitting out stay on schedule.

 

 

HEINEMANN AND DUFRY ARE MAJOR PLAYERS

Besides its duty free arrivals and departures shops, the retailer will also be managing and operating 70 boutiques at the location with the option to operate or rent these out, so Heinemann is clearly well positioned for a Russian come back in travel spending, whenever that may be.

 

For its part, the Turkish Government is certainly trying to assist its travel partners and one of the measures it has promised this year is a $6,000 fuel allowance for all aircraft delivering holiday tours to Turkey via travel agencies, plus financial assistance for some tour operators should they need it.

 

Turkey was actually the sixth most popular world tourism destination last year and it held up remarkably well considering pressures on some of its most important visitor nationalities. This year is already proving more challenging however, with Russian numbers down and likely to stay down for the time being.

 

The Turkish Association of Travel Agents (TÜRSAB) has already reported a 26.5% decline in the number of Russian tourists visiting Istanbul in January and February. At the same time, the tourism authority is pointing to a 28.7% overall decline in the number of Russian arrivals in the first quarter of 2015, compared with the same period in 2014.

 

Notes: *provisional 2015 data. Source: Ministry of Tourism, Turkey.

 

 

NEW STRATEGY CALLS FOR DIVERSITY

Meanwhile, the government has launched a new programme called the Tourism Strategy of Turkey – 2023, which is aimed at developing a greater number of tourist destinations in the country, to relieve some of the pressure away from the most popular resorts.

 

This will be equally welcomed by Dufry, following its $1.7bn acquisition of Nuance last year, which delivered the historically very popular Antalya Airport arrivals and departures business. The ‘Turkish Riviera’ airport handled a total of 28m passengers in 2014 – up 4.7% compared to the previous year.

 

In the first three months of this year, traffic at Antalya reached around 2.4m between January and March, according to airport operator Fraport, which added that this represented a 6.3% increase.

 

The Antalya Airport duty free arrivals and departures concession was certainly one of the most attractive assets within the Nuance portfolio when Dufry acquired the company last year for $1.7bn.

 

BETTER PLANNING REQUIRED

In the meantime, the Turkish Government’s tourism report says that the development of mass tourism activities and approaches to tourism planning – or more appropriately non-planning – have led to mass tourism concentration at the Mediterranean and Aegean coastal areas. This in turn has resulted in distorted urban development and house building in back-shore and adjacent areas, plus deficient infrastructure and environmental problems.

 

The reports adds that the only way to put this right is to introduce ‘an integrated policy and strategy’. As a result, it says it is now proposing to work more closely with the private sector to develop ‘tourism cities’ in coastal areas in a more sustainable and cohesive fashion.

 

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