MADRID – Spain needs to cut its airport taxes to help its embattled tourist industry to survive the downturn, the country’s largest hotel chain Sol Melia said in an interview.
“We don’t understand why they (the government) don’t step in more incisively to support an industry which is so important,” Gabriel Escarrer, one of Sol Melia’s two deputy chairmen was quoted as saying by financial newspaper El Economista.
“For example, they could reduce airport taxes, which are the highest in Europe and among the highest in the world.”
Spain, the world’s second biggest tourist destination after France, relies on tourism for around 10 percent of its GDP or some 100 billion euros ($128.5 billion) a year.
The sector is being squeezed by the global crisis, which is sapping consumer spending on luxuries like holidays, and by the pound’s fall against the euro which is putting Britons off some of their usually favourite Spanish resorts.
Earlier this month, tourist trade body Exceltur said one million fewer Britons, a nation representing 28 percent of all foreign visitors in 2007, had visited Spain in the last year.
Sol Melia had about 898 millions euros of debt and at the end of July assets worth 4.7 billion euros, Escarrer said.
“We feel very comfortable with these levels,” he said.
Last year, the company told Reuters it would cut back its 1.1 billion euro 2008-10 investment plan amid the crisis and make maintaining financial health its priority.
The company’s goal was to recover its investment-grade triple B rating, Escarrer told El Economista.
Future investments would be in the Mediterranean, the Caribbean and some holiday destinations in Asia, he said.
“The urban sector in Spain is also very important and we are thinking about going into the United States,” he said.
However, the firm would use its cash flow, rather than debt, to make investments and would partner with travel companies.
“We’re not going to focus on purchases, but on management, renting places and, of course, on franchises,” Escarrer said.