Greece Letter: Tourism no panacea for myriad troubles

When I remarked recently to a non-Greek cafe owner that the Greek economy was banjaxed, he replied “Why should I care?” This, from someone largely dependent on tourism. One can, perhaps, understand the viewpoint “the Greeks have only themselves to blame”, but the resuscitation of the economy is everyone’s concern, and tourism is its greatest growth area.

Tourism accounts for 20 per cent of Greek GDP and employs 20 per cent of the workforce. In hot spots like Corfu, Rhodes, Crete and Mykonos, the percentages are much higher. Some of the refugee-hit eastern Aegean islands such as Lesvos, Kos or Chios, depend almost exclusively on tourism for their economic survival.

Beyond these facts, however, is the much larger question of how this sector of the national cake is to be expanded. As the economy shrinks, with continuing collapse in the retail sector, tourism assumes an ever-greater role.

As Athens journalist Nick Malkoutzis observes: "Greece's economy seems like a one-trick pony that repeatedly relies on a thriving tourist sector to get it out of trouble". But, as he also points out, this kind of enterprise is not matched by other export industries. Greece's trade deficit rose by more than 20 per cent in the past year. Apart from the capital controls still in place, plus liquidity problems in every sector, the under-developed industries (mainly agricultural) desperately need a one-stop shop to facilitate exports.

Moreover for every temporary tourist there is a potential long-term emigrant. Over the past eight years, an annual average of 50,000 young, highly educated people have gone to seek work abroad. The loss to Greece’s GDP has been estimated at €13 billion, about the same value as the exchequer’s direct income from tourism.

While overall visitor numbers are increasing, there’s an issue with how the statistics are interpreted and projected. The fact that holidaymakers in resort hotels or day trippers on cruise ships spend almost nothing in the hinterland is irrelevant to the statisticians in the ministry of tourism.

Niche markets

Greece is a country full of ruins, including its economy and its political system. Its unique selling proposition is sun, sea, scenery and sight-seeing. There are, however, niche markets that are not exploited: Greece could build golf courses to compete with Spain and Portugal, and marinas to vie with Croatia (at present the Mediterranean marine leader).

It has drama, film, music and literary festivals whose foreign audiences could be hugely expanded, yet despite year-on-year promises from the ministry, these markets remain untapped.

Quite apart from numbers and revenue, Greece needs to upgrade its quality image, using cultural tourism to play down the inevitable lager-louts at one end of the spectrum and the luxury spenders at the other.

Soon the Travel Channel will screen advertisements for next season, featuring gastronomy, lifestyle, city tourism, and of course sun and sea. Meanwhile Yahoo will carry a three-month campaign aimed at the US, United Arab Emirates and Saudi Arabia.

Chinese tourists are being wooed, as part of China's ongoing investment in Greece – a Chinese company already owns Piraeus, the busiest port in the Mediterranean. Chinese tourists increased to 150,000 last year, with 500,000 as the next target. Chinese investment is in competition with Russia, as the geopolitical marketplace expands, and Russian tourist numbers doubled in the past year, many of them staying in Russian-owned hotels.

One of the issues vexing the industry is the necessary development of infrastructure and the potential damage to historic sites by growing tourist numbers. One can imagine the impact on Newgrange or Dun Aengus if they had to accommodate five million tourists each year, and rising.

Exploiting tourist potential means more hotels, more roads, more on-site facilities and consequent impairment of the physical environment. Philippi, a grossly under-visited archaeological treasure (and, as students of Shakespeare will know, the location of the battle between Mark Anthony and Brutus) has just been designated a Unesco World Heritage Site, providing its custodians with that kind of headache.

The imperative to attract tourists has to be weighed against the cost to the monuments and the coastline. I wrote here in 2014 about the pristine promontory of Eremitis in Corfu, which is due for a total development of hotel, villas, shopping centre and marina. Where there is today a unique nature reserve, there will be tourists who cannot enjoy the beauties because their hotel is sitting where they once were.

Brexit may affect Greece, since the UK is second only to Germany in tourist numbers, but the number of UK bookings to Corfu after ITV's series The Durrells is almost frightening, because the infrastructure isn't there to support them. So: more hotels, more coaches on the narrow roads, more diminution of the natural environment. And more revenue.