Tourist arrivals to Egypt fall 5% below govt projections, analysts point to Israeli aggression on Gaza as factor

The number of tourists visiting Egypt, a key source of foreign currency revenue for the treasury, fell slightly under projections for October.

Tourism Minister Ahmed Issa said that the number of tourists fell by 5 percent in October compared to the government’s targets for the month, though he described the impact as “limited” and noted that tourism revenues are still up in comparison to 2022.

Sources from the tourism industry who spoke to Mada Masr said that the slight decline in comparison to projections could be due to cancellations made by travelers responding to Israel’s ongoing aggression on Gaza, which sits to the north of Egypt.

1.4 million tourists were expected for the month of October, said Issa, but Egypt only received 1.33 million visitors. However, Issa noted that tourist numbers had still increased by 8 percent on a year-over-year basis, registering a 9.5 percent growth in the number of nights booked by tourists for the same period.

The sector was anticipating an overall increase of around 20 percent in the number of incoming tourists in 2023 compared to 2022, said Chamber of Tourism Companies member Magdy Sadek. While Israel’s war on Gaza has affected the predicted rate, he said, it remains an overall increase over last year.

The slight decline in the number of tourists was felt equally across most tourist destinations in the country, Bassel al-Sisi, the former vice president of the Chamber of Tourism Companies, told Mada Masr. Cairo suffered less of the impact though, he said,  since many foreign visitors come to the city regularly for reasons beyond standard tourism.

US tourists have canceled the most reservations, according to MP Nora Ali, head of the Tourism and Civil Aviation Committee at the House of Representatives . Ali said that cancellations by tourists from the United States were as high as 25 percent in a number of cities, including Hurghada, Marsa Matrouh, Marsa Alam and Cairo.

“Most American tourists had a three-way trip between Egypt, Israel, and Jordan, and therefore canceled their reservations. This is the nature of Americans who quickly fear that if an event happens in Afghanistan, they will not come to Egypt, and the American tourist belongs to the segment of high-spending tourists,” Ali said, during a phone interview with TV anchor Lamis al-Hadidy.

Sadek, however, is worried that cancellations will continue to rise in numbers as the war continues, saying, “all predictions now depend on what will happen in Gaza, and whether there will be a ceasefire.” 

A recent report from EFG Hermes predicted that revenues from the tourism sector and gas exports combined will decline in the next month by US$4–$5 billion due to the war on Gaza, though it did not specify the amount for each. 

Israel reduced the amount of its gas exports to Egypt during the first week of its offensive on Gaza. Without the normal quantity of gas coming in, Egypt was unable to export liquified natural gas to Europe, which translated to a decrease in foreign currency revenues. Egypt’s domestic supply of gas was also impacted. 

Facing a severe economic crisis, the government has been keen on rebuilding the tourism industry, one of its main sources of foreign currency, with Fitch Solutions predicting back in September that the sector’s revenues are expected to reach US$14.4 billion by the end of 2023.

Some of the industry figures who spoke to Mada Masr remained optimistic that Egypt’s tourism sector will be able to recover. Such exceptional periods, said Sadek, require extraordinary measures to keep the sector growing.

Sisi, on the other hand, believes that the only way forward is for the sector to keep working and promoting tourism in Egypt. Representatives of the sector are currently doing just that at the World Travel Market exhibit in London, he added.