Saudi hajj firms see $240m loss over swine flu fears

Hajj and umrah related businesses in the holy cities of Makkah and Madinah have incurred financial losses estimated at $240m as a result of swine flu fears, it was reported on Sunday.

Tourism officials said the economy had suffered serious damage amid the current H1N1 concerns which had prevented many people from travelling to Saudi Arabian to perform umrah during Ramadan, causing occupancy rates to drop by up to 40 percent.

“The available scenario for solution for the international companies is three fold: obtaining urgent assistance from the government to alleviate the losses caused by an unexpected situation, share losses with hotels and housing units or leave the market not only empty-handed but with heavy losses,” Asharq Al-Awsat newspaper reported, quoting Marwan Hafdhi, vice chairman of the Tourist Company for hajj and umrah in Madinah.

“The 5-star visitors who spend money on VIP accommodation stayed away this year and thus caused hotel occupancy to drop to between 30-40 percent this year,” Hafdhi told the paper.

He said financial losses were incurred by hotels, furnished apartments, the gold market, malls, supermarkets, retailers and small shops and this resulted in a huge economic slowdown.

Ali Jaballah, the owner of Amjad Al-Salam Hotel in Madinah, told the paper that more than 300 hotels in the central area of the holy city incurred losses of more than SR400 million when their occupancy fell below 10 percent during Ramadan.

“For hotels, Ramadan means half-pilgrimage. We have already lost this half and we do not know what will happen next,” he said.

READERS' COMMENTS

MORE FROM ARABIANBUSINESS.COM