Egypt sees 20 percent rise in tourists this year despite insecurity

(Reuters) - Egypt projects a rise of about 20 percent in tourist numbers this year, the tourism minister said on Wednesday, despite outbreaks of violence after last year's Arab Spring.

The uprising that toppled Hosni Mubarak last February and political instability since then have stopped millions of potential visitors to Egypt's beach resorts and ancient sites.

Tourism accounted for more than a tenth of Egypt's gross domestic product before the 18-day revolt that was driven by widespread anger at poverty and high-levels of corruption. The country's large cities are still prey to unrest.

But Tourism Minister Hisham Zaazou cited strong recent occupancy rates at hotels. About 8.8 million tourists visited Egypt in the first nine months of this year, he said at an industry event, and revenue was 6.9 billion.

"What I'm targeting is 11.5 million to 12 million tourists by the end of December. For sure over 11 million," Zaazou said. He said numbers should return to 2010 levels by the end of 2013 depending on the security situation.

Some 14.5 million tourists visited Egypt in 2010, generating around 12.5 billion Egyptian pounds ($2.05 billion) in revenue, whereas last year 9.8 million tourists brought in 8.8 billion pounds, according to government figures.

The government has a long-term plan to draw 30 million tourists by 2020, generating industry revenue of $25 billion.

Clashes in Cairo between liberal opponents of newly elected Islamist President Mohamed Mursi and his supporters following a demonstration injured more than 100 people last week. Another protest is planned on Friday.

In addition to security concerns, anxiety over the growing influence of Islamists following Mursi's election has fed tourism sector investors' fears over possible restrictions on alcohol sales and swimwear at popular resorts.

Zaazou said that while the government may introduce options for tourists wanting to adhere to Islamic sharia law, that would not change what Egypt offers tourists elsewhere.

"Our desire to introduce additional products that would suit certain Arab and Islamic market segments ... will not happen at the cost of our mainstream business," he said.

Zaazou said he would look into a possible tax break for investors in the tourism sector and present a study to the government. The study may propose tax breaks of up to 10 years for developers who build hotels within a specific period.

He said he was also looking into restoring air routes that closed when governments issued warnings on travel to Egypt.

($1 = 6.1050 Egyptian pounds)

(Reporting by Asma Alsharif; Editing by Louise Ireland)

Amr Elezabi, Egypt Tourist Authority

Written by Michelle Baran, Travelweekly.com

Egypt's tourism industry came to a standstill in the aftermath of last month's 18-day revolution. Senior Editor Michelle Baran of travelweekly.com sat down with Amr Elezabi, chairman of the Egypt Tourist Authority, in Cairo last week to discuss the impact to the industry and the plan for recovery.

Q: How much has the tourism industry been affected by the revolution and the political uprisings?

A: It has made quite an impact.

Last year, Egypt registered almost 15 million tourists, which was a record, with an increase of 17% compared with 2009.

From 2005 to 2010, our increase in the number of tourists was 80%.

Even though the events began in January, January was a good month. We registered almost 12% [more than in January 2010].

For February, I don't have the final figures, but we suppose it will be, maximum, between 15% and 18% of what it was [for] February last year.

Q: How much tourism revenue has the country lost?

A: We estimate that we have an average revenue of $25 million [per day]. So you multiply $25 million [by] the number of days from Feb. 1, and you will have a rough figure.

Q: How much do you stand to lose?

A: We have [several] scenarios. The first scenario is that from here to the end of April, we will have more or less 30% of the movement of last year.

In summer, we'll have between 50% and 60%, and we think that from October -- it will vary from market to market -- we'll have between 80% and 90% of the market.

Q: How important is tourism to Egypt's overall economy?

A: Egypt tourism represents 11% of the [gross domestic product]. So it is very important to the Egyptian economy.

Directly and indirectly, there are 2.5 million people working in tourism.

If you multiply this by the average number per family, you will have at least 10 million people depending on tourism.

Q: Is the biggest challenge you face now that travelers are electing to postpone their trip to Egypt until 2012?

A: We were just at ITB in Berlin, and I think we had one of our most successful ITB fairs. ... We had, I think, one of the most successful press conferences in the history of ITB, with 250 journalists there.

Now there is the highest degree of awareness of Egypt worldwide. I'm sure that this awareness is potential for the coming years.

For sure, I'm foreseeing an increase in terms of numbers. The thing is how to transform the awareness into a decision now.

It depends on a lot of factors. First of all, that we communicate ... a clear message about the possibility of tourism now, that the country is running, all the tourism infrastructure is running well, all the hotels are open, the destinations are there, the pyramids are there -- they didn't move.

All the touristic and archaeological sites are open.

And the situation is calm, there are no problems.

Q: What would you say to people who are concerned about ongoing demonstrations?

A: Now, after the revolution, there are many more social demonstrations than there were before. The only thing in Egypt is that this is new.

Egypt is living, effectively, the first step of a clearer democratic system, with a lot of elements experiencing new ideas, new practices that were not there before. And people must get used to it.

We are closer than ever to the democratic values of the West.

Q: There's a sense that crime has gone up because of a lack of central government, that there is more lawlessness. Would you say Cairo is as safe today as it was prior to the revolution?

A: Cairo was an extremely safe city. So if there is a sense that crime is increasing in Cairo, I must tell you, it will be the difference between a totally safe city and the normal rate of crime.

The truth is, Cairo is a safe city. ... Our revolution, as it was communicated by President Obama, was a peaceful revolution. But the thugs in such situations get the profit out of it.

Things are now getting calmer and calmer, and I think Cairo can now be considered a safe city.

Q: Your job is promoting Egypt, but obviously Egypt is becoming something else. How are you rebranding the product that you are selling?

A: The question is how to operate change within continuity.

What we did at ITB, for example, we kept some of our visuals and we added some slogans that were relating between the revolution and hospitality.

We had our logo and slogan: "Egypt, where it all begins."

The new beginnings happening here in 2011, it's an open end. But how to reflect this idea on the creative aspect?

We are working on it.

Q: Will there be a launch date for a new, post-revolution campaign?

A: Regarding our strategy, everything is changing day by day.

Q: How has your funding been affected?

A: Our budget is from the Ministry of Tourism. For now, we don't suffer.