American tariffs could theoretically lead to a reduction in tourist flows from the US to Greece, affecting Greek tourism revenues.
This is what the president of the Panhellenic Hoteliers Federation (PHO), Mr. Yannis Hatzis, points out in a statement on social media as one of the theoretical scenarios for how the tariffs imposed by the Trump administration could “touch” tourism from the US market.
As Mr. Hatzis explains, the increase in tariffs could slow down global trade and economic growth, limiting the disposable income of American travelers and this could theoretically lead to a reduction in their tourist flows to Greece.
“However, I do not believe, at least at this stage, that this short-term ‘anomaly’ in global economies will be able to greatly affect such a resilient product as Greek tourism,” he stressed.
From the podium of the Delphi Economic Forum, the president of POX developed the possible effects of tariffs on Greek tourism from the American and European markets…
– Tariffs create a form of inflation in the destination where they are imposed, with imported products in the US becoming more expensive. This inflation, on a theoretical level, affects tourism as it constitutes a discretionary expense – a customer’s choice – and not a basic need. By extension, theoretically, increased inflation would lead to a lower willingness to travel, especially for the weaker economic strata of society.
– If Europe does not follow [with corresponding measures], its inflation will decrease and economic activity will decrease; thus, theoretically, the income of Europeans who are our main customers will be affected, and theoretically, incoming traffic will decrease.
At the same time, how the currency is formed is of key importance for tourism. As Mr. Hatzis underlined, “a weak dollar will theoretically affect America and Europe, because a strong euro will make Europe’s exports more expensive, affecting its economy.”
Nevertheless, he appeared optimistic about the resilience of both Greek and global tourism. As he mentioned, global data shows that global tourism will increase by around 10% this year, however, he raised a concern for Greece regarding the reduction in per capita spending, which, as he said, in deflated prices is even greater.
Mr. Hatzis reiterated that Greece’s main tourism product is the “sun-sea”, which generates over 70% of the country’s tourism wealth, and it is important to maintain its brand. In fact, he underlined that Greece is third in terms of competitiveness of this product, after Spain and Turkey. “It is important that Greece, as a very strong brand, with the highest satisfaction index in the Mediterranean, goes a step further in the diversification of its product, but stands firmly on its base, in the ‘sun-sea'”, he said.
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