Is a holiday in Turkey too expensive?
Eid holiday, which is the most active period for domestic tourists in tourism, is left behind. Vacationers are faced with accommodation, food and beverage and entertainment sectors that have become more expensive with inflation. There were those who argued that there was an unusual increase in prices, especially during sea holidays. It was observed that many people from the so-called white-collar segment spent their holidays abroad due to prices. It was also a matter of curiosity how the price increases affected the flow of foreign tourists. We asked all these questions on the agenda to tourism professionals. Mediterranean Touristic Hoteliers and Operators Association (AKTOB) President Kaan Kavaloğlu, Turkish Travel Agencies Association (TÜRSAB) Mediterranean Regional Representative Board President Rıza Perçin and Turkish Travel Agencies Association (TÜRSAB) Bodrum Regional Representative Board President Yüksel Aslan evaluated the latest situation in tourism.
The 9-day holiday, which is the most active part of the summer period for local tourists, has come to an end. The effect of inflation was also seen in tourism. Compared to the same period of the previous year, price increases emerged. There were also those who argued that the holiday in Turkey is too expensive and spent this period abroad. With the increase in the exchange rate, the question of how it will affect the arrival of foreign tourists to our country came to mind.
We asked the industry insiders about the latest situation in tourism. Mediterranean Touristic Hoteliers and Operators Association (AKTOB) President Kaan Kavaloğlu, Turkish Travel Agencies Association (TÜRSAB) Mediterranean Regional Representative Board President Rıza Perçin and Turkish Travel Agencies Association (TÜRSAB) Bodrum Regional Representative Board President Yüksel Aslan answered the questions.
"There is nothing more natural than an increase in prices in tourism"
THERE ARE REACTIONS THAT PRICES HAVE INCREASED TOO MUCH ACCORDING TO INFLATION. ARE YOU AGREEING TO THIS? WHAT IS THE LAST SITUATION IN TOURISM?
Mediterranean Touristic Hoteliers and Operators Association (AKTOB) President Kaan Kavaloğlu: I do not think that prices have increased more than inflation. Looking at the average prices, you know that a large part of the income of exporters and tourism professionals is foreign exchange income. Therefore, due to the fact that there was no significant increase in the exchange rate due to the foreign exchange policy in 6 months, hoteliers were unable to meet their fixed costs. They have become unable to meet their energy, employment and food and beverage expenditures. When the exchange rate reached 28 liras, it became somewhat affordable. In a sector where 90 percent of its income is foreign currency, the fact that foreign currency was at a certain level had a bad effect on tourism professionals. In the domestic tourist section, the first prices are available in November-December for those who book early, and when you look at the prices, you can see how much discount they are. Domestic tourists, like the British and Germans, started to make early reservations. All those who have foresight about this are having a holiday at the most discounted prices. Prices are rising gradually. I would like to emphasize how important early booking is.
Rıza Perçin, Chairman of the Mediterranean Regional Representative Board of the Association of Turkish Travel Agencies (TÜRSAB): Tourism is actually going badly. Do prices have an effect on this? Of course. Has it increased more in the face of inflation? There is no such thing. Tourism prices increased by 50-60 percent at most. 20 days ago it was going bad. Why? The dollar did not rise. When there was a slight increase, it compensated for it.
Turkish Travel Agencies Association (TÜRSAB) Bodrum Regional Representative Board Chairman Yüksel Aslan: The price of everything has increased. Tourism feeds 52 sectors. The biggest cost is personnel and energy. There is nothing more natural than an increase. The minimum wage has increased by 400%. We also employ staff. Since the service sector is the biggest expense item, personnel. Energy and food are other major items. When you look at these, there is already an increase in 1 year. There is nothing more natural than an increase in prices in tourism. Holiday purchasing power has decreased, I think because of inflation. There is a price increase of nearly 100 percent when compared to last year.
"THE FOREIGN TOURISTS HAVE INFLATION IN THEIR OWN COUNTRIES"
THE PRICE INCREASE AFFECTED LOCAL TOURISTS, WHAT IS THE REACTION OF FOREIGN TOURISTS?
KAVALOĞLU: Foreign tourists also have inflation in their own countries. In the past, we used to try very hard to get a 5-percent raise. We would have conversations with tour operators. Now we have to increase the price by 15 to 25 percent in euro terms.
PERÇİN: We used to sell a package for a thousand dollars. Right now we have to sell it for 1,600, 1,700 dollars. Because prices have increased. For example, if a product is 100 TL, it becomes 300 TL, and if it is 10 TL, it becomes 30 TL. Prices of some products increased by 150%, 200%. Therefore, hoteliers had to increase their prices. Definitely not an increase in the economy.
ASLAN: There are complaints from domestic tourists as well as foreigners. There is a 50 percent depreciation of the ruble against the dollar, and there has been an increase in dollar terms in Turkey. There is a minimum increase of 20-30 percent in dollar terms. The purchasing power of foreign tourists has also decreased. The prices did not only affect the locals. We see the decrease in demand especially in July. July-August is the period when prices are at their highest, and we see a decrease in demand due to prices here as well.
"THEY CAN GO TO SEYCHELLES WITH THE SAME MONEY INSTEAD OF TURKEY"
HOW IS THE SITUATION IN THE COUNTRIES WE ARE IN COMPETITIVENESS?
KAVALOĞLU: The most important issue is the countries in which we compete. Only during the pandemic period, our prices exceeded a thousand dollars. Back then, there was no tourism where prices were discounted, so it seemed like that. We are around 860-880 dollars for package tour prices. We are now looking at the daily overnight prices. We saw $85 for the first time last year. Nightly prices in our competitor countries are around 110 dollars. In countries such as Spain and France... It seems that we will exceed 90 dollars this year. Prices should be looked at that way. With Egypt, we touch each other very little, only seasonally. We have no direct competition with Egypt. Our main competitors are Spain and Greece as resort hotels. We see France as an exemplary competitor because of Southern France. I see it as a goal that must be reached.
PERÇİN: The problem is in the competition with other countries. Let me give an example from Russia; Last year it was a thousand dollars for a hotel, this year it comes to 1700 dollars. It used to come in 2 hours when there was no embargo, now it comes in 4.5 hours. For the same money, a tourist can go to a hotel in Dubai, to a country he has never been to, or even to Seychelles. Therefore, the advantage of the places where we competed was the increase in prices in Turkey. That's why we had a hard time for a few months, and we're still struggling.
ASLAN: I do not think that there is a decrease in demand among foreigners themselves. We have lowered the demand. We also have different advantages. We do this job better, we provide better service. There is a price-benefit balance, as soon as the customer finds the price, it slides. There are currently too many European tourists in the Greek Islands. We do not have that many Europeans, there is a low demand. However, we believe that we can handle it. We've been through a lot of hardships.
"INCREASE IN THE CURRENCY IS POSITIVE FOR TOURISM"
HOW DID THE INCREASE IN THE EXCHANGE RATE AFFECT TOURISM?
KAVALOĞLU: Exporters and tourism professionals want the exchange rate to be above a certain level. They try to cover some of their fixed costs with that exchange rate increase. At the moment, the point the rate has reached is sufficient for us. We are citizens of this country, and we know what the value of our own money is. The current level is sufficient.
PERÇİN: There is a fact about the increase in the exchange rate, the higher the exchange rate, the better the tourism. For example, while we could buy 10 grams of something for 10 dollars, now we started to buy 16-17 grams of something. So it cut costs. The current exchange rate has a positive effect on tourism.
ASLAN: Tourism professionals were expecting an increase in the exchange rate. Expenses are increasing, many items are dependent on foreign currency. We expect a foreign exchange increase in income growth as well. I think the exchange rate is not at a sufficient level yet. We expect it to increase further.
"INCREASE IN VISA-FREE COUNTRIES"
THERE ARE COMMENTS THAT THE SECTION, CALLED WHITE-COLLARS, FINDING TURKEY TO BE EXPENSIVE AND SHIPPING ABROAD. IS THIS TRUE?
KAVALOĞLU: There have always been people who went to Greece. This is the supply warning of demand. I say don't go to the Greek islands, go to the TRNC. And you're going with your own money. You stay bed and breakfast, they argue that outside expenses are lower. This is true for some islands, but not true for others. Those who had the opportunity to go to those Islands were already leaving. European Union countries could not give a good test during the pandemic period. They could not fully support each other. After the pandemic, they see tourism in the EU as domestic tourism, especially in tourism. They put Greece forward in this regard.
PERÇİN: I think there is no increase. There is a visa problem, there is an embargo applied to Turkey, especially in 2-3 months. Even some artists who always give concerts could not get visas. Existing visa holders can of course go. There are Balkan countries that do not want a visa, there has been a slight increase in going there. We always say, please spend your holiday in Turkey. There are many beautiful undiscovered places, we have many more beautiful destinations than visa-free countries. For example, there are places like Demre and Kaş. Let's go to places we haven't been.
ASLAN: There has been an increase in people visiting visa-free countries, such as Georgia and Montenegro, during the holiday. Prices in the domestic market during the holiday are very high compared to the outside. People went so that we could see a different place and pay less in terms of price. The tours were full. While the average stay in the domestic market was 4-5 nights, it has now decreased to 3 nights.
HOW MUCH HAVE THE PRICES INCREASED ACCORDING TO TURKSTAT?
According to the 'Consumer Price Index, June 2023' data announced by the Turkish Statistical Institute; There was an increase of 42.64 percent in 'Package Tours', 44.02 percent in 'Accommodation', and 58.87% in 'Hotels, Pensions and Others', compared to the same month of the previous year.
HOW MUCH DOES HOTELS COST?
According to the estimation of Tourism Databank based on TUIK data, food and beverage costs in hotels increased by 59.6 percent in real terms. Food-beverage+energy costs increased by 74.56 percent in real terms. The increase was 67.3 percent in F&B+Energy+parsonel. The highest increase is in energy with 104 percent.
BRITISH COMPLAINS ABOUT PRICES: 25 PERCENT PRICE INCREASE IN CRITE AND 21 PERCENT IN MALLORCA
The British press, Daily Mail, recently published a news about the increase in the cost of vacationing in Europe. In the news, it was stated that there was a 25 percent increase in prices in Crete Island in Greece, 21 percent in Mallorca in Spain, and 22 percent in Tenerife.
Using the data of a tour marketing platform, the news included figures on all-inclusive holiday packages. Prices in Spain, Turkey, Greece, Portugal and Southern Cyprus, which are the most popular destinations for the British, were presented to the readers. It was noted that there was an average of 12 percent price increase in these 5 destinations.
The rising cost of summer holidays points to more pain for cash-strapped Britons, hit by rising inflation due to rising energy costs, mortgage rates and food shopping.
“The average price in the five destinations has increased by more than 30 percent compared to pre-pandemic levels, well above the general inflation rate since 2019.”
HOW MUCH WAS THE INCREASE?
The price increases in the news of the Daily Mail are as follows:
The average holiday wage in Spain for August 2023 was £926 per person, an increase of £118 from £808 last August.
In Turkey, this figure rose from £902 to £991, an increase of £89.
In Greece, the average cost of holidays per person rose by £124 from £974 to £1,098, and in Portugal by £51 from £949 to £1,000. In Southern Cyprus, the figure rose by £93 from £1,060 to £1,153.
Mexican holidays are up £126 per person, from £1,656 to £1,782; Egyptian holidays were up £100 from £1,135 to £1,235.
Bulgaria remains the cheapest option out of the ten analyzed destinations, but this option also increased by £96 from £746 to £842.
The United Arab Emirates, meanwhile, was the country with the most monetary gain out of ten places, up £260 from £1,426 to £1,686. Morocco also rose sharply by £204 from £755 to £959.