Tourism in summer has been "manageable" but the future remains "unsure" and next year could turn out to be tougher, according to the president of the hotels and restaurants association.
Speaking at the launch of the BOV-MHRA hotel survey for the second quarter of 2009, which showed the anticipated weak performance and the industry's fourth quarter of decline, Kevin De Cesare said results for the third quarter were inevitably expected to be lower than last year.
Hotel closures were on the cards for winter with no certainty of reopening next summer, he said.
The survey showed that the first six months were the poorest in the last six years, with drops in every key performance indicator: guest nights for Q2 were down by 17 per cent; occupancy by 16 per cent; arrivals by 11 per cent. Tourism spend dropped by seven per cent when compared to the same period in 2008.
Guest nights, the single most important performance indicator for hotels, were at their lowest for the last six years, the result of a shorter average length of stay.
The three-star category suffered the most, with a drop of over 20 per cent in occupancy, but its room rates did not decrease by the same proportions.
The survey showed arrivals dropped from every source market except Italy and hotels were compelled to lower their rates, with revenue falling to the bottom line, eroding profits, despite aggressive cost-cutting measures, including lower wages and less staff.
Hotels had no option but to significantly reduce their headcount, impacting employment and the economy.
Describing 2009 as the worst year in the past six, Mr De Cesare said the rate of slowdown eased slightly in summer but hotels continued to discount their rates "too much", a move he considered a lost opportunity, resulting from hoteliers' fears that business would not materialise.
The summer's major problem was the drop in room rates, he said, fearing that "the next thing to be lowered would be our standards", with refurbishment and upkeep programmes being put on hold.
The hard work of the last decade had been eradicated in the previous nine months but the dire situation was only expected to last another six, he said, adding they were nonetheless "critical".
Mr De Cesare called on the government to invest wisely in effective marketing and route development to regain lost ground in a short period, insisting on more funds for the Malta Tourism Authority, without which results would have been disastrous.
He urged the government to push for new routes, despite an 11 per cent growth as a result of low-cost carriers over 2008, and also to support Air Malta in its own route development.
As part of the budget, the government should formulate a priority action plan, he said.
The numbers required to turn the performance from doom to boom were minuscule in the global perspective and the MHRA was confident a proactive strategy could work.