Joseph Sarkis was appointed minister of tourism in the new cabinet. Here, he talks to Executive about this year’s downturn, the balance between security and tourism, and his hopes for public-private sector cooperation in promoting Lebanon as a major tourist destination.

E To what extent has the tourist sector suffered this year?

It is obvious that the security and political situation has had an impact on tourism in 2005. However, if we look at statistics up to the end of October and compare incoming visitors with the same period in 2004 – which was an exceptional year – we see a decrease of only 13.5%. This is not a dramatic drop if you consider what happened during the early months of this year. In 2004, we had a total of around 1.3 million visitors. This year we are already at 970,000 and still have two months to reduce the gap. Although the total will be lower than last year, it will not be much less, which means that people who come to Lebanon as tourists or businessmen have persevered with the situation and realize that there are political differences everywhere in the world, not just here. This was especially true for the Gulf tourists, though with the Europeans the decline was more marked.

E How have you promoted Lebanon in this difficult period?

I have tried, as minister of tourism, to maintain Lebanon’s name as a destination and its presence in the market. We succeeded in that goal without forcing it through any major promotion or advertising, as we know the situation is not ready for the launch of a big campaign. So we have used these last months, since I came to office, to prepare our infrastructure and programs to be ready for a better period.

E So it’s been a case of watching and waiting?

Yes, but also taking part in seminars and conferences in the Middle East and all over the world. In September I personally attended a conference in Amman for the Middle East section of the World Tourist Organization (WTO), which had all the other ministers of tourism from the region. I am happy to report that we succeeded in our bid to host next year’s meeting in Lebanon, which is very good news for us. We have almost finalized dates with the WTO’s secretary-general, who will attend, and the conference should take place in April 2006. It will be a great event for us. We are now working on a special program to demonstrate Lebanon’s unique potential amongst Middle Eastern countries.

E Was there any other good news?

Just a few weeks ago, on November 25, the WTO held its general meeting in Senegal. Lebanon was re-elected as a member of the general board, along with two other Arab countries. Again, this is a positive thing for us.
E Has international support for Lebanon’s tourist industry been more noticeable since you came to office in summer?

Yes, it has been noticeable. Tourist authorities all over the world are showing support for Lebanon, and the international community understands our post-war potential. We’re grateful to them, especially to the WTO. Since being in office, I have also received ambassadors from all major western and Arab states, who came on protocol visits but who told me that they are backing Lebanon and are willing to help. It was encouraging to hear that.

E How can Lebanon improve its image abroad?

Our target is to show the good face of Lebanon, not just the bombings and assassinations. We need to show that ours is a peaceful country. I explained many times that the bombings in Lebanon this year are different from all those which took place in other countries. Here, it is a targeted political issue and not the kind of extremist terrorism we see elsewhere. Tourists in Lebanon were not targeted. So I made an effort with the media, two or three months ago, and told them that they should be messengers for Lebanon, that they should not exaggerate in showing bombs and blood. Take the example of London or Sharm el-Sheikh: when the attacks happened there, we did not see TV images of people dying or suffering. And I think the media here have taken this into consideration and will help our image.

E Do you think Lebanon is regarded as a ‘safe’ destination?

Somebody asked me the other day which country I thought was the safest in the world. It was hard to answer because there is danger everywhere now, not only in the Middle East, and not only from terrorism but also natural disasters. Of course this doesn’t mean that we lie down and accept problems, but what is happening in Lebanon has happened elsewhere and will happen in other countries too.

E Are security measures having an impact on tourism?

This is an important point and will actually be the main theme of next year’s WTO meeting. How can we take strong security measures without restricting the flow of incoming tourists trade? Every country, not just Lebanon, must try to find a middle road between these two issues.

E Did the ministry’s budget grow this year?

We are fighting to keep our present budget. As you know, Lebanon has a difficult financial and economic situation and we still have an extremely low budget of about $8 million. Between a third and a half of this covers salaries and fixed costs, which leaves the rest for projects and promotion, which are obviously very expensive. So it is a small budget, as is the case with most ministries.

E Can the private sector help?

Of course, and I am trying to develop an excellent relationship between the private and public sectors – this is in both our interests.

E Concretely, what is the ministry doing to foster this cooperation?

We are finalizing the structure of a kind of tourist board, which could be named Destination Lebanon. It will be headed by the minister of tourism and will have representatives from private sector syndicates, like hotels, as well as other companies with an interest in raising visitor numbers, like Solidere. The board will have twelve to fourteen members and its job will be to promote Lebanon all over the world, as well as play an advisory role to the ministry of finance. It will have independent authority and its own budget. We are now completing a legal draft, which I can then show to the private sector, with the hope that the board will be created before the end of the year.

E Traditionally, Lebanon has attracted mostly Arab visitors. But which other markets have potential?

There is one large and easily accessible market – the Lebanese Diaspora. Lebanon only has around 4 million people, but at least another 10 million live abroad. I want to target the 2nd and 3rd generation emigrants who still feel Lebanese and retain links with this country. We need to send a message to them, tell them that Lebanon is their country of origin and encourage them to visit – something I recently told to a meeting of Lebanese émigré businessmen on Curacao, near Venezuela. I think this whole market has huge untapped potential.

E And to promote it?

We still think that satellite television is the best way to do an international promotion. Channels available abroad like LBCI or Future TV often make a film or a campaign about Lebanon, but this is not enough. We need to go to international media like CNN to get our message across. But as I said, now is clearly not the optimal time to spend money on launching a major promotion.

E In late August, Jordanians could obtain a visa at Beirut’s airport for the first time. How did this affect arrivals?

Very positively, and I worked personally on this. Because of the changes, 17,000 Jordanians arrived in September, which is a huge number. In fact September was the only month with year-on-year growth in arrivals. We also relaxed restrictions for Iraqis, and most probably the same will happen for Turkish visitors too.

E Does the Iraqi market have potential? What about security issues?

In Jordan, there are about 800,000 Iraqis, who have been largely responsible for an economic boom there. We also want to capture this market and are targeting the many rich Iraqis who like to travel. Next year there will be direct flights to Erbil, in the north, and also to Baghdad, so we hope to increase numbers. Security must be weighed up, but a key point is that we have no land border with Iraq. And I think the new security chiefs are aware that we have to find a workable balance between restrictions on entry and the health of the tourist trade. Of course, people are also worried that some visitors might stay in Lebanon and work illegally, which is why we should take care.

E Is Lebanon perceived as an expensive destination?

I always try to put pressure on all parts of the tourist trade, not only travel companies but also hotels and restaurants, to avoid giving the impression that Lebanon is an expensive country. If that happens, then we will pay the price. In the ministry we fix rates according to the grade of hotel or restaurant and we always bear in mind that prices must be reasonable. This is a constant concern, but having traveled so often I do not think it is true that Lebanon is expensive, especially when you consider the level of service we offer.

E Speaking of hotel grading, is there a need for an updated classification system?

Yes, definitely. We are tied to old legislation. But we are actually working on this with the private sector, which submitted a very good draft proposal to us. A specific team at the ministry, as well as our legal department, is tackling the issue, although putting it into force takes time. We would need to cancel the old law in parliament and pass the new one, but we hope to submit the new legislation for approval very soon.

E Looking ahead, are you prioritizing any particular niches?

I feel that developing eco-tourism and mountain tourism is important. More and more travelers want to get away from luxury, expensive hotels in the city and instead go to more scenic surroundings. Lebanon must take advantage of being the only country in the Middle East with ski resorts. We already have the support of NGOs and international organizations who are willing to help – for instance, two months ago we released a new information package to promote sites outside of Beirut, and were helped by SRI and USAID.

E Lastly, how dependent is 2006 recovery on political stability?

Of course, it is dependent on it. But every country has political instability, and I think we need to differentiate between political problems and bombs, which are far more damaging to tourism. I am now optimistic that Lebanon will not go back to a period of war or violence, and that the worst is behind us. But, equally, we have to give all this some time to settle.

Joumana Azzi

Branch manager at Wild Discovery Travel & Tourism

E How many Lebanese are taking holidays abroad on an annual basis and how has this figure evolved over the last few years? What characterizes the outbound Lebanese tourist market? Is the trend of package tours catching on?

While we do not have exact figures on the number of Lebanese taking holidays abroad on an annual basis, the market for outbound holidays as a whole has been increasing substantially over the last few years, with many people going away three to four times a year.

The statistics on airport passenger traffic clearly indicate that there has been a substantial increase in departures over the years up until the first month of 2005. The year 2005 witnessed a decrease not only in the incoming flow of passengers, but also in the outbound tourism market due to the events Lebanon went through. However, despite the unstable situation, Wild Discovery increased its business volume in 2005, compared to 2004.

The outbound tourism market in Lebanon is mainly characterized by the diversity of the destinations that are chosen by the clients. The main destinations that are most frequently requested by the Lebanese are Egypt, Turkey, France, Italy, Greece and Cyprus. But Wild Discovery is seeing an increasing number of individuals going to the Far East, South America, Spain, Vienna, Prague, as well as very exotic destinations such as the Maldives, Mauritius and others, especially newlyweds going on their honeymoon.

The trend of package holiday solutions has caught on. It is attracting mainly clients wishing to buy a fully organized product, taking advantage of the knowledge and the expertise of the operators and most of all, the price advantage when you book a package compared to when you book individual and separate services. Obviously the size of the tour operator, his knowledge and his professionalism are key to a successful holiday experience.
 

Philippe Skaff

CEO (MENA) of Grey Worldwide

E To what extent was Lebanon’s image affected by the events of 2005? How did the media contribute to this? What approach should both the public and private sector take in 2006, to improve the perception of Lebanon abroad?

Although Lebanon’s image has been hurt this year, I think the effect was disproportionate to what actually happened. Like anywhere, the media always jump on bad news, and whilst they don’t necessarily exaggerate events, they take them very much out of context so that one bomb seems to imply total chaos. The loss of [ex-premier Rafik] Hariri, who was a very charismatic and appealing figure for the West, has also harmed Lebanon’s image there and almost left us orphaned.

To improve people’s perception of Lebanon, I think we have to prioritize both tourism and protection of the environment – the two go hand in hand. I would leave aside superficial things like shopping and instead concentrate on our cultural and historic riches. Lebanon has a unique and diverse atmosphere, which you can feel as soon as you step off the plane; it’s somewhere you come back to again and again, unlike some places where you can virtually tick off like a checklist. It’s like the difference between a poem and a story – you can read a story from beginning to end, but a poem has a certain ‘feel’ to it which can be rediscovered a thousand times. Every foreigner I meet who comes here on business says that Lebanon is the best-kept secret of the Middle East, which suggests that its image abroad is worse than the reality. But it’s impossible to run a promotional campaign on CNN, or wherever, at the same time as there are bombs on the news.

Ramzi Assily

Resident manager, Movenpick Hotel and Resort, Beirut

E What contribution can tourist resorts make to the Lebanese economy? What are your expectations for 2006, and over the long term? What can be done to better define and improve nationwide quality standards for resorts and hotels?

Tourist resorts already make an important contribution to the economy, especially with the local community and Lebanese expatriates who return from abroad during the summer. Resorts are definitely an upcoming trend now. We’ve seen more opening both to the north and south of Beirut, and they’ve proved that a six-month season between May and October can be very lucrative. And once one operation makes money, others will follow – like any trend in Lebanon. I don’t know exactly what’s in the pipeline, but one or two more new resorts will probably open next year, and the existing ones will expand. Our own operation is slightly different, as we are only open to hotel guests and owners of our cabanas, but next year we should maintain the same trend evident since we started. Obviously this last summer was not as good as 2004, but if the political situation stabilizes then we’re optimistic for a strong year.

In terms of standards, quality clearly starts right from day one and the size of the initial investment. But my personal opinion is that we need a better system of classifying hotels, ideally with foreign consultants brought in to help judge star ratings. And although Lebanese staff are sought after in the whole region, our training colleges need to find a better mix of management and technical skills. At the moment, there are only the two extremes.

Pierre Achkar

President of the Lebanese Hotel Association

E How many hotel rooms will Lebanon offer by the end of 2006? Is this capacity appropriate for Lebanon’s needs? What are the requirements for healthy and sustained growth in the hotel industry in 2006? What can the public sector do to better supervise and assist hotels?

We have around 16,700 hotel rooms at the moment. Another 3,000 rooms are under construction and although I don’t know exactly how many will open in 2006, we usually expect 500 to 600 new rooms annually. Next year should be no different. Often it is old hotels being renovated, which are sometimes not included on the figures for new rooms. There is no shortage of rooms, although occupancy rates have been down this year thanks to the political situation. Since 2001, we’ve seen growth of 30% per year, and expected 2005 to be the best ever. But for the first three months, Beirut was virtually closed and all our plans were cancelled. Things picked up during the summer and in fact, given all the uncertainty, it has actually not been a bad year. For healthy growth in 2006, though, the absolute first priority is political stability. As soon as we have that, we need a major promotion to improve Lebanon’s image abroad. In terms of public sector help, although legislation does need to be updated, it is not a prerequisite for growth in the hotel industry. More important is to unify the public and private sector in promoting the country, as professionals in the private sector know better than the government what should be done, and how to do it. I also believe that the national tourism council should be reactivated and funded jointly by both private and public sectors – this kind of co-operation is important for the health of the industry.

Khalil Malaeb

CEO of K&M Health Tourism International

E Why do visitors come to Lebanon for medical treatment? How healthy are the future prospects for developing this niche? Can we expect any major developments in 2006?

Our medical tradition is very important – we have 140 years of experience and this helps create trust with patients. Our doctors are often foreign born or educated, and a very high percentage of them practice a specialty or a sub-specialty. Plus, the cost of care here is about 40% to 50% cheaper than in Europe, with exactly the same quality, and Lebanon is the only country in the Middle East to have 80 hospitals accredited internationally. Compared to Arab countries, the cost of care here is similar but the standards are higher, whilst the market for Arabs taking medical treatment abroad is lucrative – it’s now worth $4.5 billion. As for the future outlook, developing medical tourism is not a one-year process. We’ve clearly been set back by the death of Hariri, who took a personal interest in promoting this niche. One major goal is to access the European market, especially those countries like the UK with long waiting lists. We also want to further promote Lebanon as a plastic surgery destination. For these kind of operations, many people now travel to South Africa because costs are perhaps 50% less there than in Europe. But we can offer even better value – and of course with the same level of excellence. In addition, we’re currently in negotiations with a re-insurance company to actually offer insurance during medical operations – something, which is usually wavered. It will apply to certain hospitals and should come into force in early 2006. Given that Lebanon will be the only Arab country to offer this kind of insurance, it’s another sign of confidence in our medical care.