Egypt to offer incentives for low-cost airlines, says tourism minister

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Egypt’s tourism minister says the country plans to announce incentives for low-cost airlines such as EasyJet and Germany’s Air Berlin and Condor to help combat a slide in tourist arrivals.

“We already have a program for tour operators that have flights, but we never had a program for airlines alone,” Hisham Zaazou told Reuters on the sidelines of the ITB travel fair in Berlin.

Visitors to Egypt’s beaches and ancient sites bring in business that accounts for 11.5 percent of the country’s economy.

The sector has however suffered since the 2011 uprising that triggered years of political turmoil and the suspected bombing of a Russian tourist plane in Sinai in October, which killed all 224 people on board.

The government has been offering tour operators an incentive of US$30 per seat on any aircraft on which between 60 and 90 percent of seats have been filled.

Zaazou said it was not yet clear whether the new program for commercial airlines would pay a certain amount per seat on planes or whether it could offer alternate incentives, such as lower handling fees at airports.

“I will announce that [the program] very soon, maybe towards the end of the ITB, when I meet with everybody and listen to everybody,” he said in the interview on Wednesday.

The number of tourists coming to Egypt fell around 6 percent to 9.3 million in 2015 from a year earlier due to the plane crash in October, while receipts slid to $6.1 billion from $7.2 billion, he said.

That is a far cry from around $12.5 billion in annual receipts Egypt earned before the 2011 uprising, which scared away tourists and foreign investors.

Zaazou said arrivals in the first couple of months of 2016 were down 30 to 40 percent compared with a year earlier and said he did not expect to see a significant improvement before the second half of the year.

“If we can stabilize the [2016] number around where we were last year, around 9 million, I will be happy. We can then enter 2017 on better grounds and make up for lost time,” he said.

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