Monday, 21 May 2012 15:15
The economic turmoil in Europe at the moment has led to
holiday companies putting in place measures of what to do should there
be economic and civil upheaval in southern Europe - put simply, for many
holiday makers and providers alike: Greece is the word.
I was planning a last minute getaway to one of the Greek Islands next
month, and I must admit to being both concerned and optimistic about my
trip. Optimistic: the euro appears to be devaluing against the pound,
good news for those travelling within the Eurozone. This week, the euro
has reached 1.25€ to the £ and is expected to keep devaluing further in
light of the Eurozone crisis. In short, more euros for your pounds =
more spending money! But Concerned: what's going to happen to Greece?
What if airlines stopped flying to Greece? What if the country 'closed'?
Given the problems, and especially with the “Arab Spring” still not
too distant in the memory, a lot of holiday makers are quite worried
about whether similar scenes will occur in Greece, with people revolting
against the austerity regime that was in place.
Things are expected to come to a head during next month’s elections
and it seems as though the holidaymakers are expecting a reduced demand
for holidays in Greece.
Contingency Measures
TUI has revealed it has put contingency measures in place in case
Greece does exit the Eurozone, which does look increasingly likely. They
have hinted they could shift capacity away from the Greek Islands if
the situation in the country worsens following the elections.
A spokesman said “We cannot predict what is going to happen, however,
the inherent flexibility in our business model gives us the ability to
move capacity dependent on where our customers want to go, for example,
last year, we moved capacity away from North Africa due to the Arab
Spring.”
There are also reports that Greeks are already pulling their euros
out of the banks, with a reported €700m withdrawn on Monday alone. The
Greeks have rejected a political party that had agreed to austerity
measures in return for two bailouts by the IMF and a second round of
elections will be held next month after days of coalition talks failed
to end with a new government.
The bailout funding provided by Greece’s Eurozone neighbours seems
about to be cut off, which would make the nation effectively bankrupt
and surely lead to its exit from the Eurozone. Some analysts are
predicting chaos as the Greek currency (whatever it may be – perhaps a
possible return to the drachma) would become worthless.
Greece still popular for holiday makers
Thomas Cook, however, has said there would be positives as well as
negatives for the travel industry if Greece left the Euro. The operator
refused to expand beyond saying that the country remained popular and
“great value” for holidaymakers.
A TUI spokesperson said “ Greece remains a popular destination for
our customers and we anticipate that it will remain so. We have
contingency plans in place should the country exit the Eurozone and we
continue to work with our Greek suppliers and hotel partners as we keep a
very close eye on the situation”.
Quite reassuringly they stated “The comfort and well-being of our
customers is of paramount importance to us. In the unlikely event that
civil unrest does break out near our resorts. We have tried and tested
procedures for ensuring that our customers are looked after.”
Noel Josephides, MD of Sunvil said their sales were 12% down since
the elections although the operator has cut 7% capacity, mainly in May.
He also said Greece would be cheaper if they returned to the drachma.
“This is a definite, as client’s spending money will go further”.
Well I’m planning on going at the start of June, which is not too far
away! I imagine the euro will still be in place at that stage, but
hopefully it has reduced in value so that I effectively have more
spending money! I think that with travelling to Greece over the next few
months timing will be everything. Although holidays may become cheaper
over the following months this has to be balanced against the possible
civil unrest. Knowing my luck, it will probably rain the whole time I’m
there in any event.
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