Efforts to increase flight services from Germany, France

The government is working on increasing the number of airlines linking Malta to Germany and France, the markets which saw the steepest drops in tourist arrivals this year, the Parliamentary Secretary for Tourism Mario de Marco, said today.

Speaking at the annual general conference of the Malta Hotels and Restaurants' Association (MHRA) Dr de Marco said the government wanted to increase the routes with those two countries, without harming those airlines which had operated services for the past years.

Talks are also advanced on the operation of more services between Milan and Malta.

Dr de Marco in his address noted how hotels were benefiting from the operation of low cost airlines, made possible thanks to government assistance.

He said that the government had also stepped up its spending on marketing and promotion, but he regretted that just 10 hotels from 1,370 properties had taken up the scheme whereby the government paid for half of their overseas promotion. Hotels, he said, should seek innovative marketing initiatives, as had been done by the hotels at Mellieha, which had together concentrated marketing on a particular region.

Dr de Marco said the government had not yet ruled out the possibility of reducing VAT on tourism services, as requested by the MHRA, but, he pointed out, the government could not lose a source of revenue while it increased its spending.

He also warned timeshare representatives against harassing tourists in the streets.

This year, he said, was approaching its end, but he warned that things might get worse before they got better in tourism. Still, the government was committed to intensifying its efforts in the coming months for the industry to emerge stronger.

During the meeting, hoteliers heard grim results from an MHRA-commissioned report, conducted by Deloitte, which showed that guest nights decreased by one million between January and August. Tourist expenditure this year is projected to be down by €80 million to reach €960 million. The major drop in tourist spending - €54 million - will be suffered by hotels.

Hotels are expected to collectively show a loss of €26 million.

The report underlined the importance of tourism for the economy and for government revenue. Of €1.4 billion spent by tourists in 2008, the government earned €95 million through VAT and €81 million from taxes paid by employees in the tourism sector.

During the meeting, George Micallef was elected to succeed Kevin DeCesare at the helm of the association.