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Thomas Cook Travel Agency Collapse Crunches Cyprus Too

September 24, 2019

The overnight end of the British travel agency Thomas Cook could cost Cyprus – a former British colony – as much as 250 million euros ($274.77 million) in lost revenues and unpaid bills due hotel owners as many of the firm’s vacation packages weren’t prepaid.

The company’s collapse stranded 15,000 people on the island, one of its most popular destinations and home to many British ex-patriates with the United Kingdom still have military bases and a large presence there.

Deputy Minister for Tourism Savvas Perdios told the Cyprus Mail the surprise was not only emotionally tough but financially painful. “It’s a pretty severe blow to tourism in Cyprus,” he said.

“Thomas Cook brought in 5 percent to 6 percent of arrivals and maybe even more if we consider overnight stays,” he added. “If we consider that each visitor to Cyprus spends around €750 ($824.32,) we can perceive the size and importance of this tour operator,” he added.

Some 8,000 Thomas Cook customers were stuck there while arrangements are being made to fly them out with estimates it could take two weeks for all to be returned home.

New flights will be operated by Titan Airways, EasyJet and Miami Air International, the paper said with with officials from Hermes  Airports, the company that runs Larnaca and Paphos air fields saying 32 Thomas Cook round trips would be canceled from Sept. 23-29 with no word on how people due to arrive would get to Cyprus, if at all.

Perdios said half the stranded were British, 40 percent Scandinavian and 10 percent Germans and that many Cyprus residents had used the airline to get to the UK and return and would also now be affected.

Those in Cyprus who booked hotels but not flights to the island with Thomas Cook, which was a tour operator as well as an airline, will have to  pay their own hotel bills until the date of their flights home with other companies. These can be recouped under travel insurance with their banks or credit-card companies, hoteliers said.

“At this moment the only ones who have serious problems are hoteliers because they offered services in July, August and even September for which most have not been paid. There is a big possibility that this money, about €50 million ($54.94 million) will be lost. I want to be honest, it won’t be easy to recover,” said Perdios.

The Chairman of the Cyprus Hotel Association (PASYXE), Haris Loizides said at some hotels the bookings from Thomas Cook amount to 70-80 percent while at others the operator had reserved all of their rooms.

“The problems for these hotels are huge as they lost their income for July, August and September,” he said.  “But on top of that, they have no bookings as of today until the end of the season,” he ended, wiping out their post-summer earnings during a time when many travelers still come to the island for early autumn weather.

Akis Vavlitis, President of the Association of Cyprus Tourist Enterprises (STEK) which represents a group of four and five-star hotels, said that normally the hoteliers would receive payment by the end of October, November and January “so the €50 million ($54.94 million) we calculated has been lost,” he told the paper.

“There are hotels that have lost hundreds of thousands and those who have lost millions so some colleagues are in a very difficult position but we won’t ask the government for anything, we’ll find some other ways,” he added.

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