The fall in the value of the Turkish lira could benefit the local tourism sector, according to the latest research from analysts at GlobalData.
A little over two years ago an American traveller could purchase 4.5 lira for a United States dollar.
However, this figure has increased to nearly 7.5 in the intervening period, making it significantly cheaper for visitors from around the world to enjoy a break in Turkey.
This falling price may help offset the decline in travel caused by the Covid-19 pandemic, agues John Vandesquille, tourism analyst at GlobalData.
He said: “The continuous drop of the Turkish currency on exchange markets, stemming from years of debt accumulation and the unwillingness of president Erdogan to increase interest rates, could actually help tourism in the region despite the uncertain times brought by the Covid-19 pandemic.”
GlobalData is forecasting a decrease in international arrivals of ‘only’ 31.6 per cent this year when compared to 2019.
“Indeed, despite having a similar number of cases to France and Italy (237,265), the number of casualties is at a similar level to Egypt and way below Spain – two of Turkey’s main competitor markets,” said Vandesquille.
“This allowed Turkey to reopen its borders to tourists on the June 1st, which slightly attenuated the impact of the pandemic on the peak season.
“Besides giving an impression of relative safety compared to its competitors, the favourable exchange rate is likely to attract foreign tourists, and, more particularly, British ones – who represented 2.44 million visitors in Turkey in and who are currently not allowed to visit some of their usual destinations such as Spain.”
British travellers are currently expected to quarantine for two weeks when returning from Spain following the reintroduction of quarantine measures last month.
“A weak currency was already the reason tourism in Turkey experienced such a boost in the past few years, despite the negative impact of the multiple high-profile terrorist attacks between 2015 and 2017 on the country’s image,” added Vandesquille.
“However, it would be good for the Turkish government not to upset Russia, which is the number one source market for Turkey (sending 7.16 million visitors in 2019), as it seems to have done by transforming the famous Hagia Sophia museum into a mosque.
“Indeed, losing this source of revenue like it did in 2016 due to diplomatic tensions (experiencing a 76 per cent decrease in Russian visitors) would be terrible for the country in the current climate.”