If we can wish Israel only one thing before it reaches its 70th birthday, it would be to double, or even triple, the number of foreign tourists who visit the country. Tourists are a nice thing to have, and not only from the economic perspective – so why should that be our birthday wish?
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Just before Independence Day this year, TheMarker published many charts describing conditions in Israel over the past few decades in education, wages, the job market, unemployment, life expectancy, health, transportation and socioeconomic inequality. Going over these graphs one by one, it is easy to be impressed by the improvements in many areas, but at the same time it is easy to discover how long a way there is to go in almost every area for Israelis to be truly satisfied with their lot.
Of all the charts, one with seemingly little drama caught my eye, maybe even the least dramatic in social and economic development in Israel over the past few decades, but it provides an important narrative framework for our unfulfilled potential in tourism. Look at the chart for a moment: It shows the number of Israelis who flew overseas from Israel from the mid-1950s through last year. In 1975, the number of Israelis leaving was 283,000, while the number of tourists entering was 559,000 – twice as many tourists coming as Israelis leaving. This ratio held through the mid-1980s, while in 1995 the numbers were equal: one tourist per Israeli visiting overseas.
Since then the number of Israelis flying out of the country has changed radically: A decade ago the number was 3.7 million, compared to only 1.9 million incoming tourists. In 2015, the number of those leaving grew to 5.9 million, over twice the number of incoming tourists. If the ratio between entries and exits from the 1970s had held, then some 12 million tourists would have visited Israel last year. But less than a quarter of that number actually came.
In order to understand the missed opportunity here, we should know that the Tourism Ministry estimates that every million tourists bring in revenues for Israel of 5.5 billion shekels ($1.44 billion) and create 40,000 jobs.
We can look at these numbers from quite a number of perspectives. The growth in the number of Israelis flying elsewhere can be seen as a good thing and we can say it reflects the opening up of Israel to the world and the development of its trade relations, as well as the rise in the standard of living that allows more Israelis to travel the world. Of course, a downside exists too – the numbers reflect the high-pressured life and high cost of living in Israel, which make Israelis feel they need a short break outside the country.
A lot can be said about the low number of visiting tourists, but they can all be summed up in one simple conclusion: Israel is not fulfilling its tourist potential. We have an amazing country in every way: cultural, historic and religious richness, incredible views and landscapes, a fascinating human and culinary mosaic, the Mediterranean and Dead seas, and pleasant weather. The country should be a tourism magnet for huge numbers of tourists, certainly when the entire world has opened up, the walls have fallen, standards of living are rising and airline tickets are now within the reach of billions of people around the world.
The problem is the tourists are still not coming, and they will not as long as the government’s only actions on the matter is a “public relations campaign to encourage tourism” with the huge budget of 5 million shekels. In order to bring in more tourists, a few other things need to happen.
Let’s take a look at what can turn a country into an attractive destination for tourists: cultural, historic and human richness, wild landscapes, a well-developed culinary culture, business opportunities, reasonable prices, good infrastructure, accessible public transportation and personal security. Israel has many of these, but fails on three parameters, which are what is holding back its tourism potential: an unstable security situation, inadequate infrastructure (mostly in public transportation and tourism services) and too high prices.
When we look at the figures on incoming tourists we discover that it is actually over the past two decades – in which the Israeli economy has taken great strides forward, developed, turned the corner and demonstrated strength and resilience – we have seen the pace of incoming tourism stop in its tracks. This only reinforces the conclusion that the reasons are really those cited earlier.
Since the founding of Israel, the nation has had to almost constantly deal with problematic security issues: wars and terrorist attacks, operations and wars of attrition, and intifadas. Since the Yom Kippur War in 1973, we have not seen a real existential war, but the past 20 years have seen much more frequent rounds of violent conflict, from terrorist attacks at the beginning of the millennium, then the Second Lebanon War and then operations Pillar of Defense, Cast Lead and Protective Edge in Gaza – and now the “stabbing intifada.”
If all these events are not enough, Israel has also lived through the past decade under a constant narrative of the development of the Iranian nuclear program. So how is it possible to attract tourists?
Even when we take the security situation out of the equation, we are left with two powerful forces that prevent the fulfillment of Israel’s tourism potential. Israel’s physical infrastructure is not developed enough, and its public transportation is poor and does not provide basic solutions for traveling from one place to another quickly – certainly not in the center of country. The country’s investment in roads and interchanges seriously and constantly lags behind, and provides incentives to use private cars and not public transport.
The tourism services infrastructure is not great either. Very few hotel rooms are under construction, and the result is a limited supply of rooms and high prices. The high cost of living affects most of what tourists pay for too: food, hotels and bed and breakfasts, and transportation. It is not enough that public transportation is poor, but gas prices are much too high because of the high taxes on fuel.
We can also mention unique Israeli phenomena such as a lack of public transportation on the Jewish Sabbath and the high cost of kashrut supervision, which makes its way into higher food prices – though in response it could be claimed that this does bring in many religious Jewish tourists.
In order to increase the number of incoming foreign tourists, Israel needs an upgrade of its transportation and tourism infrastructure, lower prices and a calmer security situation. Whoever thinks that a two-week long public relations campaign can change this and raise the number of tourists is just dreaming.
We have three excellent reasons to set such a goal of increasing tourism, and if all that does not bring in millions more tourists, it’s not a big deal. At least we will receive a lower cost of living, improved infrastructure and a stable security situation. It could even reduce the number of Israelis taking overseas vacations, because what are we looking for there if it is cheap, accessible and safe to vacation in Israel?
Tourism Minister Yariv Levin is going crazy trying to answer the question how to bring more tourists to Israel using the traditional methods: investing in marketing and developing attractions, as well as a joint project with the Finance Ministry to build 15,000 new hotel rooms in the next few years. All this is not enough, so he is trying to promote the idea of building a casino in Eilat too.
Building a casino in Eilat is a bad solution, and not just for internal Israeli societal reasons. Attracting gamblers means declaring defeat in our attempts to benefit from the historic, religious, geographic and cultural assets of Israel; and saying we are unable to make use of them without first dealing with the problems of security, infrastructure and high cost of living. Building a casino would give tourists the message that Israel cannot manage to provide answers to the fears and limitations on vacationing in Israel, so it has turned to a group that by definition likes risk and being reduced to staying inside an air-conditioned and pampered hotel: gamblers.