Slow recovery?


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The sincere passion almost bounding off Hisham Zaazou, Egypt’s tourism minister, as he pleads with a room full of hospitality investors in Dubai to believe that his homeland is safe, for their money and tourists alike, would have been infectious only a few years ago. But that’s what a violent revolution will do to a once-revered country.

Egypt’s ancient pyramids are still gleaming under the desert sun, the Nile is calmer than ever and its world-famous beaches and coral reefs are intact. But convincing the outside world to see this for themselves is not easy, as Zaazou is discovering.

Two years after Hosni Mubarak was ousted in a historic, predominantly youth-led uprising, hotel occupancy across Egypt remains in the low 40s, while the average daily room rate is only slightly above $100, according to hospitality consultant STR Global. And the pipeline for investment remains well below par.

But Egypt is on a mission to draw back not only the 14.7 million people who visited the country in the year prior to the revolution but to see that figure double by 2022.

With the industry contributing more than 11 percent to GDP and accounting for about 12 percent of total employment, reviving it is critical to the economy’s overall health. Egypt remains in talks with the International Monetary Fund over a $4.8bn loan and its foreign currency reserves are almost dry.

Tourism has long been a key economic driver for Egypt, helping it rise above most of its African neighbours. The number of foreign tourists and hotel occupancy rates were increasing dramatically prior to the revolution in April 2011. Unsurprisingly, they plummeted during that year and investors either cancelled or stalled the construction of new hotels and tourism initiatives.

But things appear to be turning around.

“We lost about 32 percent [in the number of tourists] in 2011, but we gained back 17.4 percent in 2012 and that’s halfway,” Zaazou says.

“I believe that by the end of this year we’ll be almost there [back to 14.7 million] — for sure in 2014. This year I anticipate we’re going to reach a figure of between 13 million and 14 million tourists and that’s very close to the figure of 14.7 million.”

The minister’s attempts to regain his country’s prestige has him so fired up that while the government is still struggling to hold onto power, he’s setting bold new targets as far as a decade ahead. “We know strategically what we want to do in ten years,” he says. “[We want to] double tourists to 30 million and double receipts to reach $25bn by 2022.

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