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Hotel owners not cutting prices, despite low demand

Date: 24.02.2009

The low number of early bookings will not move seaside hotel owners to cut prices, it emerged at a meeting of the industry and State Tourism Agency (STA) chairperson, Anelia Kroushkova.

As they struggle with soaring energy and food bills and rising loan interest rates, most hotel owners find it hard to make ends meet, said industry representative Dimitar Vulchev.

The only way to lower prices was an emergency state cash injection of 200-300 million euro into  infrastructure improvements and reduction in visa prices for Russian tourists, he said.

Bulgaria’s tourist services are on average 200-300 euro more expensive than in rival destinations, including Turkey and Greece, and lower prices and outstanding service is what could lure more holidaymakers, according to Kroushkova.

Even countries in less favourable economic situation are taking steps to boost tourism, although it accounts for a much smaller portion of their gross domestic product (GDP), said Ventseslav Tanchev, Altours representative for Bulgaria and manager of Suntours.

He argued that one factor impairing proper state action to tackle the issue was the distorted statistics, with vast discrepancies in figures reported by the tourism agency and the industry.

For example, STA estimated the number of British tourists that visited Bulgaria last year rose by 2.5 per cent from 2007, while in fact the segment is plagued by a major outflow. In an indication that British holidaygoers are turning their back on Bulgaria, UK tour operators Thompson and First Choice have dumped the country’s northern Black Sea coast, citing flagging interest.

Tanchev sounded the alarm that with bookings falling by nearly half, bankruptcies will be inevitable. Many hotel owners were still waiting for last year’s money from tour operators, and in the meantime cut down on renovation, salaries, food and other expenses, he said.

Romanian and Russian tourists were unlikely to come in big enough numbers to reverse the overall decline in tourist numbers, Tanchev said.

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