Greek holiday bookings fall
Jeremy Guest: December 2014
Greek holiday bookings for 2015 have taken a nosedive as canny holidaymakers adopt a wait-and-see attitude to the latest political crisis in Greece.
Holidaymakers hoping to cash in on early-bird deals with deposits on 2015 holidays could find themselves out of pocket if snap elections bring right-wing political parties to power in Greece.
The radical Syriza party, rapidly gaining ground among disaffected Greeks, is pushing for a default on international loans and an early Greek exit from the Euro.
Such a move could force a return to the drachma with a huge impact on the Greek economy. The collapse of any new Greek currency could also make Greek Island holidays much cheaper.
Unfortunately for many Greek hoteliers, accommodation deals for 2015 have already been agreed with the major tour operators so a collapsed economy will leave them taking the biggest hit.
But cash-strapped tourists looking for the best deals will wait for the dust to settle on the latest political upheavals in Greece.
The Association of Greek Tourism Enterprises (SETE) warns that advanced hotel bookings for 2015 have already dropped significantly because of uncertainty surrounding political developments.
SETE President of the, Andreas Andreadis says tour operators are expressing concern over the deposits paid to Greek hotel owners as worries grow at possible political change and an upheaval in the Greek banking.
SETE has called an emergency meeting of heads of the Greek tourism sector associations to discuss the industry's response and actions in the light of latest opinion polls on the outcome of elections.
Officials fear a reversal after the record tourist arrivals in Greece and the Greek Islands this year following high numbers in 2013. There have been several isolated cancellations and postponement of conferences and other events scheduled for 2015.
Greek Prime Minister, Antonis Samaras decided to call snap elections in a confidence vote on to continue the current course of austerity and high taxes to pay of multi million euro loans for the EU and IMF in the wake of the 2008 banking crisis.
But the far leftradical Syriza party is cashing in on public unrest by calling on Greeks to default on the €245 billion rescue package with an immediate exit from the Eurozone.
The political unrest comes just as the Greek economy looked set to return to normal with GDP expanding for the first time in five years and a boom in the Greek holiday industry.
But hard-hit Greeks, faced with more years of austerity and high unemployment have given Syriza a boost in the polls with around 30% of the vote, enough to give it the hard liners a place in government.
The uncertain political future triggered a collapse in Greek shares and sent borrowing costs back above 8% — well above the level that most economists consider sustainable.
Eurozone finance ministers have agreed a two-month extension on Greece's latest bailout bill but they have called for even deeper austerity measures, including a hike in VAT and further cuts in pensions in return.
Prospects of a VAT hike for hotel owners could add 5% to the price of a Greek Island holiday next year and bigger rises to follow if the present government gets its way.
Greek Tourism Minister Olga Kefalogianni is strongly opposed to a possible VAT increase for hotels and called the moved a 'wrong measure'.
The alternative may bring even cheaper Greek Island holidays next year but it also raises the prospect of a troubled economy, political unrest and even runaway inflation.
Little wonder that holidaymakers are waiting for the latest political crisis resolved before booking their 2015 Greek Islands holidays.