'Tourism is our lifejacket': debt-stricken Greece gets record number of visitors | Business

'Tourism is our lifejacket': debt-stricken Greece gets record number of visitors | Business

Up high, above the hills of Arcadia, historic Dimitsana is on a roll. Its hotels are brimming, its cafes are full, and its footpaths and monasteries lure busloads of tourists decanted daily from other parts of the Peloponnese.

Either side of the main road that splits the mountain village â€" in a world far removed from talk of emergency bailout funds, international stewardship and gruelling austerity â€" Greeks are hard at work, running boutique guesthouses, eateries and bars in the stone mansions that line Dimitsana’s cobbled streets.

“Business is very good,” says Labis Baxevanos, the village’s deputy mayor, who owns a patisserie along the strip. “So good that a lot of younger couples have come to work here since the country’s economic crisis began.”

Debt-stricken Greece is braced for a record-breaking 30m holidaymakers this year, almost three times its population. Addressing the Panhellenic Exporters Association last week, the tourism minister Elena Kountoura said that between January and May there had been a noticeable increase in arrivals, revenues and occupancy rates with summer bookings in some areas rising by as much as 70%. Travel receipts grew by 2.4% or €23m (£20m).

After eight years of grinding austerity, the influx is a tangible gift, on a par with the €8.5bn financial lifeline thrown Greece earlier this month to once again avert default.

Dimitsana â€" once famous for the gunpowder mills that produced the firepower in the nation’s 1821 war of independence against Ottoman rule â€" is emblematic of the entrepreneurial spirit taking root as a result of the boom. “Tourism is our lifejacket,” says Theonimfi Koraki, who opened a boutique hotel in the village last summer. “The aim now is diversity and drawing out the season all year round. Here in Arcadia the creation of the 75km-long Menalon [walking] trail has been hugely successful for example with foreign tourists. It has greatly helped the development of the region.”

With the exception of shipping, tourism is Greece’s biggest foreign earner, the mainstay of an economy that has otherwise contracted by 27% since late 2009 when the country’s debt crisis began.

The industry accounted for eight out of 10 new jobs in 2016, vital for a nation hit by crippling levels of unemployment. Bank of Greece figures show around 23.5 million tourists visited in 2015, generating €14.2bn of revenues, or 24% of gross domestic product. Last year, the country’s tourism confederation, SETE, announced arrivals of 27.5 million, an all-time high.

Increasingly, the sector has helped boost much-needed job creation, according to data released by the labour ministry. Recently, the prime minister, Alexis Tsipras, said April and May had been record months for tackling the problem with 92,000 and 89,500 jobs created respectively. For every extra 30 holidaymakers a job is created, say officials. They have been at pains to make the point as striking municipal waste workers not only unnerved tour operators this week but highlighted how important tourism is for the economy.

Mountains in Arcadia. Photograph: Alamy

Greece, more than any other Mediterranean country, has reaped the benefits of tour operators pulling out of Egypt, Turkey and Tunisia, destinations now considered a security risk following terrorist attacks.

Arrivals from the UK have jumped by 40%, with about 3 million Britons expected. Visitors from Germany and the US have also surged, with 900,000 Americans due to arrive this year â€" up by nearly 200,000 â€" thanks in part to Emirates Airways inaugurating direct flights on a daily, all-year-round basis between Athens and the US. The American Society of Travel Agents, reflecting the sudden rise in interest, has announced it will host its annual expo in Athens next year.

“We are doing better than our neighbours,” the country’s new tourism chief, Yiannis Retsos, told the Guardian. “Turkey in particular has been badly hurt. But sooner or later those markets will rebound which is why Greece needs to extend the season, exploit its amazing landscape and diversify beyond the traditional sun and sea product.”

Young, tall, lean and bearded, Retsos represents a new generation who believes there is plenty of room for improvement if Greece grasps the nettle of reform and modernises.

While the country’s growing tourist sector has been attributed to an increased focus on alternative types of holiday, he wants to see more people getting professionally involved in the sector. Almost alone among EU states, Greece still lacks further education courses in tourism despite the country’s dependency on the industry.

“I want to see more young people consider a career in tourism,” he said, adding that Athens should imitate Turkey and allow private companies to invest in infrastructure. “Turkey, for example, has many more marinas than us and as a result attracts high-income tourists. I’m all for privatisation because it improves services. In a country like this, economically, it’s so difficult for the public sector to manage such facilities.”

Navagio beach on Zakynthos island. Greek tourist chiefs want to sell more than just sun and sand. Photograph: roxanabalint/Getty Images/iStockphoto

In April, the German airport company Fraport took over the operation of 14 regional airports across Greece at the behest of the EU and IMF, the bodies behind the three emergency bailouts Athens has received since 2010. As the Tsipras government’s first major privatisation, the €1.2bn deal initially triggered widespread condemnation, with veteran leftists in the two-party coalition privately decrying the “colonial” takeover. For years privatisation has been regarded as a dirty word.

But the 40-year lease will also mean the state-owned German firm pouring in more than of €1bn to the airports, with more than €400m being invested over the next four years. “As Greek airports are upgraded through the life of the project we expect to see a significant increase in flights to the underserved regions of Greece and that will provide a basis for sustained long-term growth,” says Alec Mally, an economics analyst at Foresight, a strategic communications company in Athens.

“More efficient connections between the Greek islands and provinces, and regions in Germany and northern Europe, will not only support tourism but boost business and trade ties.”

In May, Athens’ newly revamped international airport also opened its doors, announcing that upgraded facilities meant it could accept 26m passengers, up from 20m last year.

Many of the additional arrivals will come from new international markets in India, Russia, Israel and China â€" a major investor in Greece from which Athens hopes to attract about 600,000 holidaymakers annually.

Among those flying in earlier this month was the governor of the autonomous Chinese region of Inner Mongolia. With a delegation of Mongolian officials, he headed not for the islands but straight for Arcadia â€" on a mission. One aimed at letting local authorities know his countrymen had heard all about Greece and would be coming.

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