Luxor suffering from decline in tourism: tourism officials

Sara Ibrahim
14 Min Read
Minister of Tourism Hisham Zaazou hoped that more tourists will be visiting Upper Egypt, especially the ancient destinations of Luxor and Aswan. (AFP Photo / Khaled Desouki)

The average occupancy rate in Luxor’s hotels during the first third of 2017 is 25%, said tourism officials/specialists.

Luxor governorate began suffering from the decline of tourism indicators since February 2011. Fifty planes used to arrive from all European countries on a weekly basis to Luxor, but now the city only receives four German flights per week, with an average of 400-500 tourists.

The percentage of fixed and floating hotel occupancy in Luxor governorate during the period from December 2016 to April was 25%, while the average price of the night was estimated at EGP 300.

Ehab Qidees, former chairperson of the Chamber of Tourism Establishments and the director of one of the hotels in Luxor, said that there were 40 hotels in the governorate (of which 11 were between 4 and 5 stars), with an estimated 4,000 beds.

He added that the number of floating hotels is 253, of which 100 hotels are suitable to operate, and in the peak period—during mid-year vacation which extends for two weeks—60 hotels are operational. During the rest of the year, only 30 hotels operate.

Qidees pointed out that there are 100 floating hotels that have been out of service since 2011 because of the lack of the periodical maintenance on a yearly basis.

The Egyptian Hotels Association requested from the Ministry of Tourism to grant loans of no more than EGP 600,000 to be allocated to the maintenance of floating hotels as a result of the erosion of their wooden floors and which have suspended their operations for a long time. However, there was no response, unlike the initiative announced by the Central Bank of Egypt (CBE), which provided EGP 5bn to renovate and replace hotels.

In 2015, the number of tourists who visited Luxor was 250,000, while the number of tourists in 2010 was roughly 3.5 million. Currently, there are no regular flights, and most of the tourists who arrive in Luxor come for a one-day visit, according to the chairperson of the Egyptian Hotels Association.

He pointed out that the occupancy rate at the peak time of the tourist season—the period from September to the end of April—did not exceed 25%.

China ranks first in terms of the nationalities visiting Luxor, followed by the United States, Germany, and Italy.

The effects of flotation of the pound were most visible on the hotel sector, as prices of goods and products used in meals increased, which in turn raised the cost of the meal, Qidees added.

Ramadan Hagag, an owner of one of the floating hotels, said that the number of hotel rooms in Luxor is roughly 13,800, divided between stationary and floating hotels.

He added that the rate of occupancy in the floating hotels in the period from February to March 2017 reached 100%, but throughout the winter season from September 2016 to April 2017, it stood at 21%.

Hagag explained that the most prominent nationality that accepts cultural tourism in Luxor is China, followed by Germany, and the average price per night is $20 (EGP 360) in Egypt.

He pointed out that companies that manage floating hotels have been trying to lay off 40% of their employees so that expenses could be covered—in light of the decline in the size of revenues and the increase in energy prices—and those companies have suffered losses since 2011.

He called on the state to support floating hotels for maintenance through allowing them to obtain loans from banks, in light of the high cost of operations and insurance, especially as tourists want to receive a good service at a low price.

Adel Al-Shazly, a member of the board of directors in the Chamber of Tourism Establishments for Upper Egypt and the general manager of 3-star hotels, said that the occupancy rate in Luxor ranged from 5% to 20% throughout the year, with the maximum during the winter season from December 2016 to April 2017.

He added that the average price of rooms in one to three-star hotels range between EGP 50 and EGP 160 per night, while the price per night in four-star hotels is EGP 300 and in five-star hotels EGP 450.

He pointed out that the level of pricing in hotels has declined because of the low economic level of the tourists arriving to Luxor, as the city is no longer receiving high-spending tourists.

The offered supply declined as a result of a 60% price-hike in goods, merchants said

The monthly income of bazaars ranged between zero and EGP 3,000, compared to EGP 5,000 and EGP 500,000 six years ago.

The number of bazaars in Luxor is 1,800, said Bakri Abdel Gelil, head of the Bazaar Owners Association in Luxor. Most tourists prefer to buy souvenirs like Pharaonic stones, cotton clothes, silverware, and papyrus.

In the past few years, the market has witnessed a decline in demand as a result of low tourism rates, and product prices increased by roughly 60% compared to last year; therefore, traders reduced the quantities of the offered products and reduced imports.

Some bazaar owners have changed their activities altogether because their incomes have declined significantly, and many of them established restaurants, coffee shops, and other shops.

Abdel Gelil pointed out that 50% of all products in bazaars are imported from China.

In terms of the decision of the Minister of Industry regarding the ban of importing products from China, he said that the bazaars have a stock of Chinese products sufficient for three years.

He pointed out that the demand on the cultural tourism in Luxor, Giza, and Aswan is relatively weak, compared to the demand on recreational tourism in Sharm El-Sheikh and Hurghada.

He pointed out that most of the bazaars are located in the Valley of the Kings, Hatshepsut Temple, Luxor Corniche, Savoy Street, and the tourist market.

Bazaar owners rent shops from the governorate, the Ministry of Tourism, or the Ministry of Religious Endowments. The average rental price in Savoy Street and Luxor’s west bank ranges from EGP 500 to EGP 850 per month, while bazaars affiliated to the Ministry of Tourism have rents that range from EGP 2,000 to EGP 6,000. The average size of a bazaar is 3×4 metres and up to 60 metres.

He added that the association has sent notes to the Ministry of Tourism since 2011 regarding the most prominent problems facing bazaar owners.

Mohamed Hassan, the owner of a spice business in Luxor, said that the price of products rose by 60-70% compared to 2016. The price of a kilogram of hibiscus reached EGP 100, and as a result, the customer buys half a kilogram most of the time instead of three, for example, he added.

The price of cardamom increased from EGP 200 per kilo to EGP 420, and the price of nutmeg rose from EGP 280 to EGP 550.

He added that the most purchased products include pepper, cumin, cilantro, nutmeg, tamarind, hibiscus, and carob.

He noted that the size of imported products out of all products offered for sale ranges between 25% and 30% compared to the local ones, including licorice, skin products, mastic, and cardamom from several countries, including Malaysia, Turkey, Sudan, and Indonesia.

He mentioned that the demand on products has declined by 70% compared to the past two years.

He said that Egyptians represent most of the groups that visit the tourist market, and sometimes there are frequent visits by foreigners from France, Germany, England, Russia, and Poland.

Shops overcome the increase in costs by dividing the cost of transporting goods amongst themselves—due to the decline of the demand—in addition to reducing the offered supply. Shops now order six or seven tonnes of the various products as one order throughout the year, unlike six years ago, when they used to order 12 tonnes that they replenished every three or four months.

Mohamed Hassan, a silverware shop owner, said that visitors of the tourist market prefer Italian silverware more than Egyptian, adding that the former represents 75% of all silverware on display.

He added that prices have increased compared to last year. The price of one gram of Egyptian silver is EGP 8, which increased to EGP 15, while the price of one gram of Italian silver increased from EGP 12 to EGP 25-30.

Hassan noted that the size of the monthly income used to be EGP 60,000 to EGP 70,000 before 2011, but now it ranges between EGP 6,000 and EGP 12,000 based on the turnout.

He added that silverware shops are one of the most popular in the tourist market, since most of customers are Egyptians and they prefer to buy silver, while bazaars and papyrus shops receive less customers.

Carreta owners demand support due to the decline of demand, riders

A grant of EGP 1,400 was announced to be provided to carreta riders several months ago to subsidise them as a result of the decline in tourism over the past six years, but they haven’t yet obtained it.

Carretas are one of the most popular means of transportation for tourists who visit Luxor’s most famous temples and ancient sites. The cost per hour of a carreta ride is about EGP 80.

Gamal Ismail, head of the Karnak Temple caretta stop, said that there are 340 licensed carretas in Luxor and 800 unlicensed ones.

The average amount spent on a horse per day is about EGP 70, of which EGP 20 is spent on berseem, EGP 40 on five kilograms of cereal, and EGP 10 for hay, according to Ismail.

He noted that there are three main caretta stops in Luxor: in Abu Haggag Square, at Luxor Temple, and at Karnak Temple. Each of these accommodate 75 carretas.

Meanwhile, other stops accommodate 37-42 carretas.

He added that the governorate announced a fixed tariff of EGP 80 per hour, yet occasionally the price is reduced when the customer haggles.

Moreover, he noted that tourists want to visit a number of archaeological sites in Luxor, including the Crocodile Island, the Holy Fountain, and temples.

A carreta owner, Ibrahim Mohamed, said that a grant of EGP 1,400 was announced a few months ago that would be provided to carreta owners when the number of tourists declined, but there has been no grant yet.

He added that the governorate disburses an allowance of 120 kg of cereal for each owner every four month as the price reached EGP 8 per kg.

Another owner, Al-Shazly Mohamed, said that tourists want to visit the Avenue of the Sphinxes, the Egyptian market, and some streets around the city. The tours take between 30 and 90 minutes.

The price per tour is different, as foreign tourists prefer hour-long tours worth EGP 50, while Chinese tourists ask for 30-minute tours for EGP 20-25. Some Egyptians prefer longer tours and spend about EGP 100.

Mohamed noted that carreta owners pay EGP 300 per year to renew the licences from the union, next to taxes, fines, utilities, and cleaning fees.

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