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Viewing cable 06ANKARA2673, MIXED PICTURE ON TOURISM NUMBERS

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Reference ID Created Released Classification Origin
06ANKARA2673 2006-05-12 11:40 2011-08-24 01:00 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Ankara
This record is a partial extract of the original cable. The full text of the original cable is not available.
UNCLAS SECTION 01 OF 02 ANKARA 002673 
 
SIPDIS 
 
STATE FOR EUR/SE AND EB/IFD 
TREASURY FOR INTERNATIONAL AFFAIRS - CPLANTIER 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: EFIN ECON TU
SUBJECT: MIXED PICTURE ON TOURISM NUMBERS 
 
REF: (A) Ankara 1460 (B) ISTANBUL 527 
 
1. (SBU) SUMMARY:  In response to an 11.5 percent year- 
on-year drop in first-quarter tourist arrivals, 
Minister of Culture and Tourism Atilla Koc admitted 
that Turkey will not meet its goal of 26 million 
tourists in 2006.  Tourism is both a key generator of 
jobs and a vital source of foreign exchange receipts. 
In terms of revenues, the first quarter tourism 
receipts equaled those from a year earlier.  Although 
earlier predictions of a bad year are unlikely to 
materialize, flat tourism revenues will not help offset 
the growing trade and current account deficits. 
Ministry officials met with sector representatives in 
April and developed a four-part action plan to bolster 
the industry and promote domestic tourism, while 
foreign tour operators encouraged Turkish officials to 
preserve natural landscapes. End summary. 
 
-------------------------------- 
FLAT REVENUES BUT FEWER TOURISTS 
-------------------------------- 
 
2. (SBU) According to an April 27 Turkey Statistics 
Institute (TUIK) report, the number of tourists in the 
first quarter fell to 2.2 million, an 11.5 percent year- 
on-year drop.  Separately, the Turkish Tourism 
Investors Association (TYD) reported that European 
tourism bookings for summer holidays in Turkey have 
fallen 40 percent year-on-year.  Though Istanbul-based 
tourism has remained strong (ref B), on April 17, 
Turkish Tourism Minister Atilla Koc admitted that he 
does not expect to meet the ministry's original 
national goal of 26 million tourists in 2006, but said 
he hopes to attract at least the 21 million that Turkey 
attracted in 2005. 
 
3. (SBU) On a revenues basis, however, TUIK and the 
Central Bank report that revenues were basically flat 
in comparison to the first quarter of 2005: tourism 
revenues rose 0.4 percent year-on-year in the first 
quarter of 2006.  Revenues rose to USD 2.002 billion 
from USD 1.994 billion a year earlier. 
 
------------------------------------------ 
MINISTRY, INDUSTRY DEVELOP FOUR-STAGE PLAN 
------------------------------------------ 
 
4.  (SBU) Following the drop in tourist numbers, Koc 
met with sector representatives to develop a four-stage 
action plan to further develop Turkish tourism and 
stimulate a return to growth in the sector.  Under the 
plan, the Ministry will establish a research and 
development department to conduct national and 
international tourism studies.  The plan also 
encourages cooperation between public and private 
sectors in promotion activities, including domestic and 
international tourism fairs.  In an effort to encourage 
the Turkish public to spend their holidays in country, 
domestic tourists would be given the option of early 
reservation and payment in installments.  Finally, all 
lodging sector personnel will receive European Union 
(EU) certification project training. Koc also discussed 
the Ministry's plan to expand Turkey's cultural, 
thermal, winter, and conference tourism possibilities. 
 
------------------------------- 
FOREIGN TOUR OPERATORS WEIGH IN 
------------------------------- 
 
5.  (SBU) In an April 24 meeting with Turkish tourism 
officials in Antalya, foreign tour operators 
recommended that Turkey emphasize protection of nature 
and increase internet sales.  Thomas Bosl, general 
manager of German tourism firm QTA, told the officials 
that Turkey has an enormous potential to expand its 
tourism sector, but cautioned against the increase in 
concrete construction along the coastline.  He noted 
that German tourists, one of the most important sources 
of tourism revenue in Turkey, preferred smaller hotels 
to large ones, and he warned that the big, newly 
constructed concrete hotels along the Lara coast in 
Antalya may block the beauty of the coastline and 
discourage tourists in the future. 
 
-------------------------------- 
BLEAK 2006 INCREASINGLY UNLIKELY 
-------------------------------- 
6. (SBU) These two recent summits are a promising sign 
that the GOT will take measures to try to sustain the 
growth in tourism revenue.  Tourism is a key sector for 
the Turkish economy for two reasons: it creates badly- 
needed jobs and is a key source of foreign exchange in 
the balance of payments.  Given that Turkey 
consistently and increasingly runs a trade deficit, net 
tourism receipts are a critical service export that 
mitigates the severity of the growing current account 
deficit. In 2005, for example, tourism revenues totaled 
$18 billion, compared to exports of goods of $73 
billion and a $23 billion current account deficit. 
 
7. (SBU) The number of arrivals are down but the fact 
that revenues are holding to the record 2005 level 
suggests earlier predictions of a disastrous year for 
tourism are increasingly unlikely to materialize. 
Though there may be weak sales in certain resorts, 
overall tourism receipts so far suggest that 2006 
receipts will not be that different from 2005.  On the 
other hand, in a context of a widening trade deficit, 
the absence of growth in tourism receipts means the 
increase in the trade deficit will translate into an 
increase in the current account deficit.  With most 
economists now projecting a much larger 2006 current 
account deficit than the $22 billion projected in the 
IMF program, growth in the tourism sector will be 
sorely missed. 
 
WILSON