European market and Cyprus tourism

The position of Cyprus as an EU member state guarantees its place on the European tourist map and preserves and strengthens its identity as an attractive tourist destination. The single European market has proved, after the loss of Russian tourists, that it is a treasure for Cyprus’ tourism. This advantage must me considered positively by continuously upgrading the tourism product, thus keeping Cyprus higher in terms of tourism. European citizens, being thoughtful and demanding, choose more easily and more frequently European destinations for their getaways, instead of non-European countries. The increase in connectivity, the euro, the single market and above all, the safety and the high level of the product it offers, constitute the factors that are taken into account in the preference and choice of Cyprus. Along with the European market, the other markets are added, each one having its own relationship and specificity with Cyprus, increasing the tourist product. These findings and the other advantages that the island offers make Cyprus a competitive destination, in terms of quality and price.

The continuous maintenance and renewal of the tourist units is a primary concern, investments are expanding and covering up to green development, even though licenses are yet to be granted for solar parks that will reduce operational energy cost. Digital technology is being upgraded, and despite the funds provided in government support, there are still gaps presented. The Digital Business Upgrade Grant Scheme, 2nd call 2023, €14 million, announced on 16.2.2023 with an online submission date of 7.3.2023 at 9:00 am, until the amount is used up, as expected, it was sold out immediately. Such plans are not announced in such a short time, while they present several loopholes that are exploited and above all not until the amount is exhausted by those who will catch up.

However, the Achilles heel of the tourist sector remains the lack of labour force because of the lack of interest due to seasonality and the absence of government programmes. The tourist season starts at the beginning of April and ends at the beginning of November. With proper planning, it can be extended by at least one month, so that it commences in early March and ends in mid-November. It is therefore possible to introduce full-time employment and training which can significantly solve the problem. There is the paradoxical phenomenon that some of the staff are employed full-time, some are declared unemployed and their salary is supplemented by the employer, and some who receive unemployment benefit work in other business or have another job.

Consideration may be given to introducing full-time employment in all departments to cover restaurant service, reception, housekeeping and bar. A subsidy for winter employment by the government can be considered, since an employment benefit is already provided which covers 70% of earnings and the employer pays 2.8% to permanent staff. In such a case, employees will be able to work or attend training and upgrading programmes to better perform their duties. The Human Recourses Development Authority programmes are subsidised and run during the tourist season, although they should be moved during the winter season. The fact that the employer pays and collects the payments from HRD Authority should not be a negative factor, their duration should be increased and cover other sectors besides restaurants, kitchen and housekeeping.

Even though there is interest from Turkish Cypriots they need training and encouragement for their employment in the free areas of the Republic. The political refugees, instead of being employed only as cleaners, should be allowed to work in other jobs, depending on their qualifications, as it is the case with workers from third countries. The cost of foreign labour taking into account salary, contributions to the various funds, benefits, food, accommodation and other expenses, is higher than the cost of local or community staff. Along with the annual increments, the Αutomatic Indexation Adjustment was given while interested persons roam the hotels without commitment until they secure the highest possible salaries.

The tourist season has started with a considerable number of visitors, and are expected to intensify from the beginning of April. The prospects are promising that this year will be a very good year, similar to those before the pandemic and the war in Ukraine. It is up to all stakeholders and the state to better manage the problems for the good of the sector, the economy and the country.