First Editorial Ever: What lies beneath Turkey’s stellar tourism statistics?

Below is my first editorial ever, a small step for me but a big step for mankind- or maybe, it's the other way around... It was published in this week's South Monday.

The editorial was supposed to be only 2400 bytes max, so I couldn't get into much detail, but I'll save it for my regular weekly column, as I plan to return to the topic when the August tourist arrivals is released at the end of September.

Anyway, on the column:

Ertuğrul Günay, Minister of Culture and Tourism, likes to boast about Turkey’s impressive tourism statistics.

After all, it is hard to argue with numbers. According to data from the World Tourism Organization, while the total number of global tourists declined 4.3 percent last year, Turkey managed to secure a 3.3-percent rise. In fact, Turkey was the only G-20 country that was able to increase its incoming tourists in 2009. And with the exception of April and July, the numbers look even more impressive this year so far. What is going on?

There is quite a bit of anecdotal evidence of what economists call “substitution effects”: As Turkey’s top markets fell into the crisis, many of those who did not want to give up their precious vacations altogether opted for cheaper destinations. This effect seems to have been especially pronounced with tourists from the United Kingdom, as tourist arrivals from there increased by a whopping 12 percent in 2009.

But there is never a free lunch in Economics. As the Ministry’s Publicity Director Cumhur Güven Taşbaşı notes on page 2, tourism revenues have not been able to register as spectacular rises. While the director links the dismal revenue performance to the falling average length of stay this year, revenues per tourist have been on a downward trend after peaking in 2003. So the problem could not be shorter stays alone.

Maybe, it is time for the ministry to start questioning the Turkish tourism model of unplanned expansion of the last three decades and the squeezed margins that have come along with. Or to ponder how most of the south ended up with the all-inclusive model. Or why the sector, other than a few exceptions, cannot increase its value added.

It would be easy to lay the blame on the greedy foreign travel agencies. But the fact remains that Turkey is at number 54 out of 133 counties in the tourism competitiveness index developed by the World Economic Forum. In terms of the sub-indices, Turkey fares rather poorly in environmental sustainability, infrastructure and human resources, none of which would come as a surprise to anyone familiar with the south. In fact, were it not for its undisputed cultural and natural resources, the country would have ranked even lower.

It is often lamented that Turkey has no coherent industrial policy. The glitzy hotels and impressive statistics almost make us forget it does not have a sound tourism policy, either.

*Emre Deliveli is a freelance consultant and columnist for Hurriyet Daily News & Economic Review and Forbes as well as a contributor to Roubini Global Economics. Read his economics blog at http://emredeliveli.blogspot.com.