TURKEY (Hurriyet Daily News) – Turkey’s tourism sector has passed a tough test in recent years and has not compromised on its standards, Turkish Tourism Investors Association head Oya Narin has told the Hürriyet Daily News in an exclusive interview.
The sector has registered big achievements over the past three decades and is now ready for a major transformation, meaning that it is also the right time to invest in the sector, Narin said, citing low investment and operational costs as well as state incentives.
Turkish tourism is expecting a strong rebound this season, but how do you think the recent steep fluctuations in foreign exchange will affect the sector?
Let me start by underlying that the Turkish tourism sector has registered important achievements over the past 30 years. One of the main reasons behind this success is the incentives provided by the state, which have mobilized investors. We have the appropriate inventory for this sector, with our coasts, natural beauties, and history. Turkey’s location gives it access to at least 1.5 billion people within a three-hour flight time.
Fluctuations in foreign exchange rates have both advantages and disadvantages. They bring an advantage in terms of sales prices and make the environment more attractive for foreign investors. But at the end of the day these fluctuations are temporary. As investors we need to have a long-term outlook.
Tell us about your expectations for 2018.
We have been through a very difficult period. But the most important aspect of this whole though period is that we passed the test. We did not compromise on our quality or on our standards and we have not received any complaints.
2018 will be the period of transition and rising. The number of tourists expected to come this year might be the same as the 2014/15 period. If we can surpass 40 million it will be a new record. But we need an improvement in prices, which requires changes in sales techniques and different marketing techniques. We need better management and promotion of destination points. In short there is a need for a transformation and a new restructuring. As an association that is what we are working on. Last November the state held a tourism congress and the report that came out of it underlined the need to get mobilized for a period of transformation in the sector.
What will be the main focus of this transformation?
Until recently we have increased our accommodation capacity. We have established very nice facilities, reached a level of competitiveness with the world, and become the sixth most visited country in the world. This is a huge accomplishment. What we need from now on is to increase the period of tourism, which is currently from between 150 and 180 days to 365 days.
We need to restructure our destination points for sustainable tourism. We need more residences, condominiums and vacation clubs to lure even more tourists to spend much more time in Turkey. We have to appeal to older age groups, developing health tourism and providing the necessary facilities so that they can stay year-round.
When you look at Bodrum, for example, there is a dynamic life throughout the year. But in other destinations the moment you leave the center there is only life during summer. When there is no sociocultural dynamism we cannot operate there. We need to equip our destinations as world cities offering gastronomy, entertainment, natural, cultural and historical beauties. Istanbul is a world city and we also have Bodrum. But we need to bring similar dynamism to the rest of our touristic destinations.
We have tabled our proposals to the Tourism Ministry as well as the Ministry of Environment and Urban Planning and we are continuing to work together. There is infrastructure and there are already investments, but we are so far only able to use 40 percent of the capacity. Thanks to the transformation there will be a faster return on investments and the investment environment will improve.
All this is music to the ears of an investor, but a foreign observer might question whether state institutions will take the necessary steps for this transformation.
Some measures have already been put in place. Some tourist facilities were leased for 49 years and they had a few years left. We appealed to the government to extend them, and the government took immediate action. There have been several legislative changes, like enabling the practice of timeshare property ownership. Our demands for health tourism were met. In the past we could only provide spa services, we could not provide physiotherapy or geriatric services. The government took steps to boost health tourism also in terms of establishing assisted living facilities. The government has been responsive to our very rational proposals.
We have some additional demands on incentives like branding and enabling direct sales in addition to tour operators so that we have faster investment returns. These are important demands because we see a lot of interest from foreign investors.
What makes you say that?
As the association, we have participated in the MIPIM, the world’s leading property market. We also participated for the first time in the International Hotel Investment Forum Berlin, a big travel industry fair. We have seen tremendous interest toward Turkey. Big international chains want to increase their share in Turkey. They are already present, but mostly in big cities. They now want to go to the southern coasts and see their brands over there. That will open a whole new chapter for us.
What would you say to convince foreign investors to come to Turkey?
First of all, Turkey is set to become even bigger in the tourism sector. Secondly, investment costs are lower compared to Europe for instance. There is a big difference in terms of costs when constructing a hotel in Turkey and in Europe. Thirdly, there are investment incentives as well as operational incentives, like tax exemptions, incentives on interest rates or about the personnel to be employed. Turkey is becoming a desirable destination, a destination people are curious about. Of course, there are some difficulties, like security.
Indeed. I was going to ask you about that.
Look, we cannot show things happening in Iraq or Syria Turkey’s security problems.
For a long time, thank God, we haven’t had a terrorist attack. They’ve had it in Paris and in London, but people are still going there. There is no problem within our borders. There is conflict outside our borders but there is nothing that affects the security of tourists or the investment climate.
I, therefore, think that now is the right time for purchases and investments and to increase the share in the Turkish market. Turkey will become a brand. It already has several brands in the tourism sector, and prices are going to go up. One critical issue is to increase the number of scheduled flights.
Investors likes predictability. Rules and regulations can change overnight in Turkey. Is that a curse or a blessing for the sector?
Turkey is an emerging market and there is dynamism. It has a high growth rate, something that is unseen in Europe. You have to look at the returns. In some stable environments growth rates and profit margins remain low. Turkey is a growing country, and when there is such energy you have to be dynamic and open to changes. The success of politicians depends on adapting to the changes.
WHO IS OYA NARİN?
Oya Narin is currently the chairperson of the Turkish Tourism Investors Association (TYD).
Born in Istanbul, she graduated from the St. Michel High School in Istanbul and received her bachelor’s degree from the Hotel Ecoliere Lausanne in Switzerland.
Following her graduation in 1986, she started her professional career by working in several hotels in Switzerland and the United States. She finished an MT program in Sheraton Hotels Hawaii Pacific Division.
Narin started her career in Turkey at the Narin Textile industry in 1988, and worked at various departments as a manager at Martı Hotels and Marinas. She has been the chairperson of the Martı Hotels chain since 2008.
In 2017, Narin was elected as the chairperson of the TYD’s board, of which she has been a longtime member.