Israeli Government to Continue Subsidizing Flights to Southern Resort Town of Eilat

The decision came despite criticism that many passengers benefiting from the reduced rates are Israelis or foreign tourists who end up vacationing in nearby Jordan or Egypt

Corals in a coral farm in the Red Sea city of Eilat, southern Israel, January 17, 2019.
Dror Komet,AP

Israel’s Tourism Ministry said on Thursday it plans to offer subsidies to airlines flying from Europe to the southern resort town of Eilat during the next winter season, despite criticism that many of the passengers benefiting from them are Israelis or foreign tourists who end up vacationing in nearby Jordan or Egypt.

The decision comes amid growing worries that the new Ramon Airport is deterring visitors to the city and that Eilat’s key tourism industry could be hurt by the July closure of Tel Aviv’s Sde Dov Airport, which is the main starting point for domestic flights arriving in Eilat.

The subsidies were introduced in 2015 to try and reverse a sharp drop in tourism in Eilat following the war with Gaza a year earlier. Airlines flying from Europe are entitled to get 60 euros ($67) per passenger during the October-April winter season. Initially the cost of the subsidy was split 75%-25% between the Tourism Ministry and city hotels, but this year the ministry covered the entire cost.

The subsidiary helped bring record numbers of travelers to Uvda Airport, which had been the international arrival terminal for the city until Ramon began accepting overseas flights last month. In the 2016-17 season, just 73,500 foreign tourists landed at Uvda, but in 2017-18 the number nearly doubled to 146,800.

But critics say that many of those arrivals are Israelis who had been traveling in Europe, or foreign tourists who land in Israel and then stay at lower-cost hotels in the Jordanian resorts of Aqaba or on Egypt’s Sinai coast, both of which are easily accessible from Eilat.

>> Israel opens new airport, raising travel to Eilat to a higher class

“We decided that we will continue the procedure in this critical year, when Sde Dov is closing, in the hope that everyone will pitch in, including the Israel Airports Authority, the hoteliers and the municipality - and help improve Eilat’s product,” said Tourism Ministry Director-General Amir Halevi.

The ministry agreed to continue the subsidy on condition that the city of Eilat and the hotels allocate money for tourism-friendly events and tourism marketing. How much they are committed to spending, the ministry didn’t say.

Halevy said that after Prime Minister Benjamin Netanyahu forms a new government, the next tourism minister can decide what the policy will be for the winter of 2020-21.

Meanwhile, the low-cost carrier Wizz Air has committed to expanding its flight schedule for next winter to 16 weekly flights from 14, including a new route between Eilat and Vilnius, Lithuania.

The gleaming new Ramon airport that was supposed to give a further boost to Eilat tourism has so far been a disappointment. In April the number of passengers going through the facility was down 11% from the same time last year, when Eilat was being serviced by Uvda and the tiny municipal airport inside the city limits.

The drop is more severe than it appears at first glance because in 2018 the Passover holiday was spread over March and April while in 2019 it was entirely in April. Moreover, overnight stays in Eilat hotels last month were up 5% year on year, showing that Israeli visitors were coming by car rather than using the new airport.

“What we said would happen has happened. The Ramon Airport right now is a failure. The Airports Authority knows it and the transportation minster knows it,” said Nir Daga, CEO of Arkia, which is one of two Israeli airlines that fly to Eilat (the other is Israir).

He said the travel numbers for Ramon were worse in May than in April and warned they would deteriorate further after Sde Dov closes and Israelis flying to Eilat will have to use Ben-Gurion International Airport. Sde Dov is now the preferred departure point for domestic flights, but the government wants to use the site for housing.

The Airports Authority blamed the drop in Ramon traffic last month on Arkia’s decision to use more of its fleet for international flights rather than for domestic one. It also blamed high airfares.

In any case, Ramon does present a problem during peak travel times. During Passover this year the traffic on Route 90, which connects the airport with the city, suffered such heavy traffic jams that many passengers missed their flights.

That is likely to occur again when the summer season begins and Eilat tourism officials fear that it will deter visitors – mainly Israelis at that time of the year.

Acknowledging the problem, Transportation Minister Israel Katz last week ordered a government committee to prepare recommendations by the end of May on how to solve the problem. The team is likely to propose the construction of a light railway connection.

With reporting by Osnat Nir and Gili Melnitcki