Are All Incoming Tourists to Israel Created Equal?

The number of visitors is soaring but doesn't reflect their buying power, among other things. Should that matter?

Tourists look at the Dome of the Rock, located in Jerusalem's Old City, June 2018.
REUTERS/Ammar Awad

Israel is setting new records for incoming tourism every month, to the great pride of the Tourism Ministry.

In 2018 some 4.12 million tourists arrived in Israel – a 14% increase from 2017 and a 46% increase from 2016. This trend is expected to continue through 2019 as well: Already this year, some 2.89 million visitors have arrived, a 10% increase over the parallel period in 2018. At this rate, Israel is likely chalk up 4.5 million foreign tourists by year’s end.

But industry players are asking whether the total tourist count is the only number Israel should be using as a measure of success. Oni Amiel, owner of tour company Amiel Tours, says that not all tourist entries are equal.

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“The Tourism Ministry counts entrances through passport control, but out of this total there are tourists landing at Ramon Airport [near Eilat] with a Tourism Ministry subsidy and just heading straight to Taba or Aqaba [in Egypt and Jordan, respectively] – and others who land at Ben-Gurion International Airport and go straight across a border,” says Amiel. “There are also tourists coming to visit family, and others who arrive and spend their entire trip in Bethlehem. It’s not like Israel had 4 million real tourists.”

Indeed, industry sources say there are other ways to measure the success of incoming tourism and note that there different criteria are used for marketing Israel to potential visitors from around the world.

Says Amnon Ben David, CEO of tour company Eshet: “It’s nice to say that 4 million tourists came, but we need to stop and check from which countries it’s worthwhile bringing tourists. When we subsidize flights from Montreal, Brazil or Mexico, that makes a big contribution to Israel’s economy. But when we’re subsidizing flights from Hungary, Poland or Romania, it doesn’t help us. Getting 100,000 Romanian tourists isn’t the same as 100,000 Canadians, and 100,000 Polish tourists isn’t the same as 100,000 Chinese visitors.”

Currently, the Tourism Ministry is helping tourists hoping to visit Israel who come from countries that lack buying power, says Eshet.

“For instance, an Indian tourist isn’t able to afford the prices in Israel. There are rich people in India and wealthy groups that come to visit from there, but still, for the pair of socks they buy here, they could afford an entire suit back home. Plus one dinner here costs the same as 10 back home. So, instead of bringing tourists from poorer countries, such as Romania and India, Israel needs to invest in bringing tourists from countries where people have more purchasing power,” he explains.

According to the ministry’s 2018 Incoming Tourism Survey, the average tourist from Poland spent $114 a day while in Israel; that figure was $118 for tourists from Romania and $90 for those from Belarus. By comparison, per day, the average American tourist spent $179, Chinese visitors spent $230 and Mexicans, $260.

“The time has come to stop getting excited about setting records and to start understanding the numbers, because statistics can be misleading,” says Danny Lipman, one of the owners of the Atlas Hotels. “A ton of tourists who land at Ben-Gurion International Airport spend their entire time in the Palestinian territories, and others stay at Airbnb rentals, which don’t necessarily even pay taxes, so they bring the state no revenues. Instead, we must count how many tourists of each type come, and how long they stay – and then we’ll understand what this 4 million means.”

New marketing strategies, such as targeted digital advertising, and a focus on new groups of potential visitors have contributed to Israel’s success in tourism. But the real growth began three years ago, when the Tourism Ministry started paying airlines tens of millions of shekels a year to launch direct flights to Ben-Gurion airport from new destinations. Because the ministry cannot directly subsidize flights, it found an indirect way to do so – via marketing grants. In order to receive such assistance, airlines commit to marketing Israel as a tourism destination in their home countries. The ministry agreed to pay airlines 250,000 euros to launch a new weekly flight to Israel, and up to 750,000 euros for flights scheduled three times a week.

Since 2016, the ministry has paid out a total 13 million euros to airlines for launching new lines. This year, only two are slated to receive such funds: El Al for its flight to Las Vegas (250,000 euros), and United Airlines for its new service to Washington, D.C. (750,000 euros).

The Tourism Ministry stated that at this point, it’s unlikely that new flights will be launched to European destinations in exchange for grants, and that now, the airlines that will likely be eligible are those offering flights to destinations that are further afield, which will be of benefit to the industry.

As to whether the grants are necessary, it stated that they do not constitute particularly large sums, that airlines sometimes ask for incentives and that the money provides them with a bit of necessary extra cash.

Up until three years ago, Israel was struggling to reach the 3-million mark in incoming tourists, something it could only dream of during years without wars. All foreign visitors were considered worthy. Now, however, industry officials are questioning whether all tourists are created equal.

Eran Ketter, a senior lecturer in the Tourism and Hotel Management department of the Kinneret College on the Sea of Galilee, says that situation is a privilege reserved for countries with much better established tourism industries.

“From a tourism standpoint, we’re still a destination that’s growing and isn’t mature,” Dr. Ketter says. “We still haven’t reached our peak capacity, to the point where we can say we don’t want more tourists. I don’t want to start saying that we only want tourists of one type or another. At this stage, just keep them coming.”