Last update - 00:00 27/11/2007
Tourism booming as hotels report highest occupancy since 2000
By Irit Rosenblum , TheMarker
The year 2007 continues to smile upon Israel's battered tourism industry: no less than 2.3 million people are expected to visit Israel this year, a hefty half-million more than in 2006.
The hotels are naturally also having a boom year, relatively speaking. Central Bureau of Statistics figures from Monday showing that nationwide hotel occupancy rose to 74 percent in October, up nearly 30 percent compared with the same month last year. It is also the highest occupancy rate for any October since 1999.
Tourism is the stuff of life to the hotel and leisure industry, but it matters to the general economy as a whole: it is expected to contribute a billion dollars to gross domestic product this year, or 0.7 percent of Israel's GDP, says Ami Etgar, general manager of the Israel Incoming Tour Operators Association.
Etgar told TheMarker Monday that the last quarter of 2007 has been a superb one for the industry, with a quarter-million incoming tourists.
Shmuel Tzurel, who manages the Israel Hotels Association, commented that the high hotel occupancy rates reflect an upswing in incoming - as opposed to domestic - tourism. The industry was hit hard by the Second Lebanon War in the summer of 2006, as missiles peppered the northern third of Israel. But the sector clawed its way back slowly during the following six months. He added that a national occupancy rate of 74 percent brings Israel near the averages in heavily tourism-oriented countries.
Where are the tourists coming from? According to Tzurel, marketing efforts concentrating on North America have had a clear effect.
"We still need to take similar action in Europe to restore traffic to Israel, and mainly to Eilat," Tzurel said. The Red Sea resort city has indeed been a favorite tourism spot among Europeans for years.
Tourism Minister Yitzhak Aharonovich is evidently optimistic about the future, and says that Israel has to start preparing for a major influx of tourists in 2008. He foresees some 2.8 million people coming, noting that Israel's total population is only around 7 million. Aharonovich remarked that the figures prove that the Tourism Ministry is managing to meet its goals in 2007, and that it had been the best year since 2000, when 2.7 million tourists visited.
Technically, it isn't only the highest number of tourists to visit since 2000 - hotels are also boasting the highest number of "hotel nights" since then.
"The Tourism Ministry has been warning for some time that within three years, Israel's hotels will need to add thousands of rooms," Aharonovich said, adding that if development of hotels was neglected, the lost income could amount to tens of millions of dollars a year.
Regarding 2008, Etgar also predicts an influx of 2.6 to 2.7 million tourists, adding $600 million to $800 million to Israel's GDP. He concurs that the only reason Israel won't bring in three million tourists is that it doesn't have the hotel rooms, most notably in Jerusalem.