The Cypriot economy is left to lick tourists like the old “harpoons” of the 80's. I do not want to spoil the dreams and reassuring thoughts we read in the reports these days, but I think tourism as we knew it has changed forever. Entrepreneurs in the industry know firsthand that they must change their model in order to survive. Attracting digital nomads who will work from Cyprus for weeks, the local markets, but also the internal market, is one way.
The “bubble” in the arrivals and profits of the Cypriot tourism burst majestically when the coronavirus pandemic hit the planet. Of course, this is not just a Cypriot phenomenon. Arrivals followed a significant upward trend almost everywhere and now they have fallen everywhere. However, the reduction would come anyway. Definitely much smoother if it weren't for a pandemic, but for some years now industry experts have predicted that airfare prices would rise, as part of environmental policy, which would delay arrivals. Now, obviously, there are other, more serious reasons.
Airlines, after a year of pandemic, have decreased in number and size. In other words, the competition that reduced prices in other times is for some routes even non-existent. Only the need for corporate liquidity may temporarily push prices down, but many argue that this will be the exception and not the rule. When the new reality crystallizes, prices will go up again. But what will be even more permanent is the willingness of companies to take risks. Forget the planes that came and went on leave. If the airline management is not almost certain that the flight will be significantly full and profitable, it will not allow the route. Not because we are dealing with conservative managers, but because their financial capabilities are limited, while many are accountable to the taxpayer who saved them. Relatively distant and expensive destinations, such as Cyprus, increase the risk even more. It is good to look more closely at the markets in our area.
But, it is not only the supply that has decreased. Demand will be equally reduced, although there is a mood for travel. For many countries the borders are closed for holidays, with mandatory quarantines and exhaustive tests, while many of the old travelers do not want to risk their health for travel. Of course, there are those who, seeing their bank account and their expenses, do not even think about traveling. They may not even think about it for several years, as the blow to their income will take time to recover. As for the many business trips, these should be a reminder of times gone by. Here, well, the employees have not returned to the offices, let alone returned to the conferences. Not that they will not happen in the future, but they certainly will not be in the degree, frequency and magnitude we knew.
Given this, the bet for Cyprus should be to persuade fewer visitors to stay longer, even longer, to limit the damage. The state and individuals should target the digital nomads and convince them that they can provide them with the comforts of work and good living conditions for them and their families. To entice them with a quarter in sunny Cyprus instead of the heavy winter of northern Europe, at a cost that is close to the cost of being in their country. Only in this way can we convince them that it is worth paying the expensive plane ticket to Cyprus. The other option is domestic tourism. It should always be the first choice for hoteliers. And in 2020 they should have understood it well when it was we were their only choice. Of course, all this needs a strong adjustment, but also the decision that tourism as we knew it, has changed forever.