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Economy

Ernst & Young Sees Greece’s Losses from Tourism at €10B in 2020

ATHENS — The estimated losses of revenues of the tourism industry in 2020 amount to 10 billion euros, while the estimated loss for Greek hotels amounts to 4.46 billion euros, according to a report on the effects of COVID-19 on Greek tourism held by Ernst & Young.

As the tourism sector is a key pillar of the Greek economy, the impact on the country and a number of related services will be significant, according to EY. The tourism sector directly contributes 11.7 pct of GDP and indirectly between 25.7 pct and 30.9 pct. During the peak months, the direct contribution to employment reached 16.7 pct and the indirect 36.7-44.2 pct, while, over the last years, the sector has played a leading role in reducing unemployment. Annual investments in tourism reach five billion euros, of which 1.9 billion euros are domestic value added.

Based on data from STR, which specializes in measurements based on data from the hotel industry worldwide, the decrease in revenues per available room (Revenue Per Available Room – RevPAR) in March, reached 69.4 pct in Greece on an annual basis. less than Italy (92.8 pct), but higher than France (67.7 pct), Portugal (66 pct) and Turkey (57.5 pct). For the first quarter in total, the decrease in Athens amounted to 32.5 pct, in Thessaloniki to 15.6 pct and for tourist resorts to 40.9 pct.

At the same time, based on current data, it is estimated that the damage to Greek hotels will reach 4.46 billion euros, of which 3.26 billion euros are seasonal hotels and 1.2 billion euros concern hotels operating all year round.

According to the report, the decline in tourist traffic is due, on the one hand, to travel restrictions and the closure of borders, and, on the other hand, to reduced demand.

Based on estimates of the tourism ministry, citing the EU report, even in the optimistic scenario, revenue losses in 2020 will approach almost 10 billion euros, retaining just eight billion euros, from revenues of 18.2 billion euros in 2019. The possible extension of the period in September, it is estimated that it will not be able to cover this loss. On the other hand, the country's good performance in tackling the pandemic may allow it to claim a larger share of this shrinking market this year.

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