Cyprus: Cyprus Tourism Profile

Tourism diversity drives the travel and tourism industry

The Cypriot travel and tourism industry has been benefiting from the variety of options available to tourists. In addition to its world-renowned inviting beaches, Cyprus enjoys a wide range of infrastructures and services relating to health, medical and sports tourism, inclunding a large number of religious and cultural buildings and wine-related events part its a lot of other attractions. These have enabled the Cypriot travel and tourism industry to overcome the unstable financial climate being experienced in its most significant source nations over the review period and the industry has been presenting in general positive results.

Seasonality still harmful to industry performance

Despite the in general positive development seen, seasonality is still affecting the performance of travel and tourism. Primarily known as a summer and beach tourism destination, tourists avoid Cyprus in the autumn and winter seasons, greatly reducing tourism activity during these months. Domestic spending on tourism has only a limited impact on the country’s economy, so efforts to make the industry less seasonal have been particularly focused on incoming tourists, but so far with modest results.

Government measures having a positive impact

The national travel and tourism industry is heavily affected by government measures. Several policies have been implemented and have been considered extremely efficient. The Cypriot government has been developing a number of partnerships and activities in order to boost inbound tourism flows, both in the high and the low tourism seasons. Partnerships have been formed with the objective of cutting airport taxes and increasing flight connections in the lower season, particularly from nations with severe winters, and these have led to an increase in the number of arrivals.

Middle East turmoil and economic climate affect departures

The social and political instability experienced in a number of Middle Eastern nations has led to a considerable decline in outbound departure flows, strengthening Cypriot request for domestic tourism. In addition, as with several nations in the eurozone, the Cypriot economy showed a decrease in its GDP in 2012, fuelling Cypriot tourists to rethink their holiday plans and costs, and limiting the increase potential of outbound spending.

Expected European economic increase to boost tourism revenues

The estimate period is expected to be a period of economic recovery for most Western European nations. As some of them, such as the UK and Germany, are part Cyprus’ major sources of tourists, this is expected to be very beneficial for the development of the Cypriot travel and tourism industry. It is expected to register record performances during the estimate period thanks to strong tourism flows from emerging nations such as Russia, and to a resurgence of tourists from traditional Western European nations.

Tourist arrivals decline marginally

Since the bulk of tourist arrivals are from Europe, slow recovery in the European economy in 2010 led to a marginal decline in in general tourist figures. A decline in tourists from the UK, the leading source market, was offset by an increase in tourists from Russia and Germany. UK arrivals declined as the country put austerity measures in place in 2010.

Strong increase for Russian tourists

Russia is the second major source market. Russian tourist increase in 2010 was driven by strong economic recovery. Since Russian tourists are as well known to be generous spenders, increase in their arrivals as well augured well for incoming tourist receipts.
Departures grow as popular destinations became additional affordable

Greece and the UK are the majority popular outbound destinations. A weaker pound sterling versus the euro meant that trips to the UK were additional affordable in 2010 despite the tough economic environment. The Greek financial crisis and ensuing unrest meant that Greek travel and tourism players lowered prices to attract tourists.

Cyprus Turkish Airlines (CTA) goes bankrupt

Since the international community, with the exception of Turkey, does not recognise Turkish-controlled Northern Cyprus, there is a ban on direct flights to Northern Cyprus. Since all flights have to initial land in Turkey, air fares are higher and flight times longer. Due to these imposed inefficiencies, CTA suspended operations and again filed for bankruptcy in 2010.

Car rental players offer competitive rates online

Since travellers are cutting their budgets, car rental players have responded by lowering prices. In order to offer competitive rates to customers without lowering profitability, car rental players are promoting their online booking channels. Discounts are being offered on standard rates if bookings and payments are made through car rental companies’ websites.

Targeting emerging markets

Due to the slowdown in Europe, Cyprus’ tourist authorities and travel and tourism players are expected to focus additional on non-European markets than before. Alongside Russia, Israel is emerging as a promising market. To focus on such markets, tourism players will need to tailor services by reducing costs.

Cyprus performs comparatively well

Internet sales and systems continue to grow