Positive prospects for tourism in 2025 but major “thorns” remain

With auspicious messages, but also with “mines” and concerns, it seems that this year’s season for Greek tourism will develop.

Abroad, the new presidential term of Trump leaves ambiguities as to how the flows of the important American market and European ones will be affected. Within the walls, the new tax burdens on tourism businesses and the ambiguity in their remunerative nature, the unfair competition from business activity in short-term rentals as well as the lack of planning in tourism, cultivate an environment of uncertainty, even “randomness” for the Greek tourism sector.

These concerns were expressed by the president of the Panhellenic Hoteliers Federation (PHO), Mr. Yiannis Hatzis, in an interview he gave on Thursday to the Naftemporiki TV channel, seeking to outline the pros and cons of the year.

As the PHO president stated, global forecasts for the tourism industry indicate that in 2025 a general increase in tourism activity is expected by approximately 10%, with an increase in outbound tourism from Germany by 7%. However, the possibility of the imposition of tariffs by the US, which could cost up to 1% of Europe's GDP, but which would have a greater impact on consumer psychology, and therefore on tourism, requires caution in the forecasts.

Trump's policy, with as yet unknown international implications, he added, could absolutely affect tourist flows from America, a valuable market for Greek tourism, and especially for Athens, due to the high spending of its travelers. However, the strengthening of the dollar against the euro makes European holidays more attractive than last year.

He noted that the fact that pre-bookings for Greece are in full swing and "going well" in destinations that set the tone for Greek tourism, such as Rhodes and Crete - with prices reduced by 20% - does not mean much for tourism revenues this year, however, if this trend continues until the ITB Berlin exhibition, by May the results will be positive, at least in terms of revenues.

These figures give a first impression, however, 2019 remains a record year for Greek tourism. As Mr. Hatzis underlined, when calculating performance we should take into account, on the one hand, real values ​​and not nominal values, as revenues are clearly inflated and, on the other hand, the fact that business inflation is higher than consumer inflation, therefore revenues and arrivals may increase but businesses may not record higher figures.

“Fees recital” in hotels

“This is important and we must have it high on the list of criteria when we tax,” he stated emphatically, emphasizing the need for a careful tax policy in the hotel industry. For example, “the resilience fee is a minefield for Greek tourism because it is imposed on the price, has geographical and temporal inequalities, has increased by 50% without us having properly made a fund for 2024 and there are huge reactions from customers directly from hotels and tour operators”, he said. The Federation, as he said, is discussing the abolition of this fee from 1.1.2026, with the reasoning that although the creation of a natural disaster fund is obvious, this should burden the entire Greek economy as a whole and not just accommodation and hospitality. “Let’s pay our fair share and that’s it”, he concluded.

Regarding the municipal hotel fees, the president of POX spoke of a recital of increases that has somewhat stalled but called on the municipalities to be accountable in relation to the return on these revenues. “The hotel industry has revenues of 11 billion, and while the temporary resident fee was 0.50%, the municipalities collected 50 million annually, now that it has been raised to 0.75%, they will collect 75 million. They should tell us what this money is being used for,” he stressed, calling for transparency in the use of these revenues for infrastructure. He also criticized the rapid increase, by 300%, in the lighting and cleaning fee, which is not justified.

“If the temporary resident fee was 50 million annually, in the last 10 years the municipalities have collected 500 million. Have investments of 500 million been made in the municipalities of the country for tourism? ", he wondered and pointed out that in the first phase, this question must be answered and then any increases can be decided.

Tourism should not be approached as a fund that will cover some expenses until the end of the year, the president of POX emphasized.

The approach to short-term rentals is superficial and delayed

Regarding short-term rentals and the new legislative framework, he said that it is a step forward, but it is a small step forward too late. “It is now clear that there is no political will to provide a substantive solution,” he stressed.

Short-term rentals, Mr. Hatzis said, have now largely become a business activity that benefits a few. Even individuals who once supplemented their income in the context of the sharing economy are now seeing it evaporate from entrepreneurs who are engaged in this activity on a much larger scale, he noted.

The approach to the issue is not correct, according to the president of POX, since only superficially and tax-wise, there has been a distinction between who is an entrepreneur and who is not, and short-term leasing has evolved into a structural problem that exacerbates real estate inflation and the inflation of incomes of individuals.

The unclear operating framework, sometimes within and sometimes outside of tourism activity, also has implications for the management of labor issues, resulting in social unrest.

In order to solve these issues, he emphasized that it should be clarified that individuals are included in the sharing economy, and entrepreneurs in the tourism activity, with the necessary observance of the specifications that apply to a hotel.

After all, the main objective of the hotel industry is an environment that is competitively equal for all, without unfair competition, and a State approach to the industry with a tax, economic, and wage policy that gives tourism the weight it deserves in the current account balance.

He also expressed his concern about the rapid spread of short-term rental, which now offers hotel prices. “Within 8 years of development, as many beds have been created as hotels have needed to develop in the last 100 years. It is easy for this to happen so quickly. And if it is so easy in short-term rental, we must see why it is not as easy for hotels,” he said.

No plan for Greek tourism

On the occasion of the hotel investment in Sarakiniko, Milos, Mr. Hatzis said that such phenomena are due to the pathogenicity of the National Spatial Plan for tourism. "Right now we are going blindly, without a program, and even now that some form of plan has been passed, there does not seem to be much political will to provide a solution to where Greek tourism is ultimately going. We found ourselves here somewhat... by chance," he said.

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