Investment in tourism drops
Investment in Greek tourism – arguably the country’s ‘heavy industry’ – declined 75 percent from 2008 to 2015, the Hellenic Federation of Enterprises (SEV) reported in its weekly bulletin yesterday.
Gross investment in tourism amounted to just 415.1 million euros in 2015, compared with 1.63 billion in the last year before the outbreak of the crisis. The rate of decline is greater than investments in the entire economy in the same period, which came to 65 percent.
After amortization, net investment in tourism was deep in negative territory at -418.7 million euros in 2015, as the investments of 415.1 million euros were dwarfed by the amortization of 833.8 million euros. This means that the investment in tourism did not even suffice for the maintenance of the equipment at hotels and restaurants.
SEV commented that the lack of investment in the tourism sector may be related to the stagnation in tourism revenues per night stayed in Greece, as this is partly affected by the inability to set higher prices due to the low specialization of the tourism product.
It added that Greek tourism attracts tourists of ever-lower incomes, who are accommodated at tourism infrastructures whose maintenance is increasingly neglected, as is the addition of new equipment. It also made a special reference to the punishing taxation after a value-added tax hike on accommodation and passenger transport.