TOURISM SECTOR TO REACH NEW HEIGHTS

On the 100th anniversary of our Republic, we became one of the top four destinations around the world, hosting 57 million tourists and generating $56 billion in revenue

The tourism sector has made great strides since the 1980s. Between 1980 and 1990, an average of 2.2 million visitors per year generated about USD 1 billion in revenue. On the 100th anniversary of our Republic, we became one of the top four destinations around the world, hosting 57 million tourists and generating USD 56 billion in revenue. By achieving significant diversity in source markets and products, we support the country’s economy, foreign exchange needs, and employment.

As a result of these figures, the tourism sector directly accounts for 5 percent of our national income and 12 percent when indirect contributions are included, supporting 31 sectors at a high level. Our cities have also advanced significantly during this process, with Istanbul ranking 1st and Antalya 4th among the most visited cities in the world in 2023, each attracting over 20 million visitors. Tourism investments are undoubtedly one of the most essential factors in the high-value-added tourism sector, which brings foreign currency into our country. In the accommodation sector, we have over 21,000 facilities with a bed capacity of 2 million.

The vision of our government is for our sector to grow significantly. Besides the Ministry of Culture and Tourism’s target of 60 million visitors and USD 60 billion in revenue for 2024, the Medium Term Program envisions annual tourism revenues reaching USD 60, 65, and 71 billion between 2024 and 2026, respectively. With a 2023 current account deficit of USD 45 billion, the significant tourism revenues position our sector as the main driver of economic activity. According to WTTC data, the travel and tourism sector accounted for 10.4 percent of the total GDP in 2019, amounting to USD 10 trillion. It is estimated that this trend, which declined with the pandemic, will accelerate again and the global GDP contribution of the travel and tourism sectors will reach USD 15.5 trillion in 2033.

Rising competition in the tourism sector is pushing Turkish tourism toward various reforms and providing opportunities to increase awareness of our brands and the country. As TTYD, we continue our efforts to protect and support the position of Turkish tourism while participating in projects on the Arabian Peninsula as an investor and tourism diplomacy representative.

As TTYD, we have prepared, published, and continuously updated the “Tourism Transformation Scenarios Report” in 2020 with the goal of increasing tourism investments and revenues from a long-term perspective. Accordingly, even without any reform program, the sector could reach a revenue level of USD 90-95 billion by 2033, corresponding to about 5-5.5 percent of GDP. However, with the implementation of a series of transformation policies, tourism revenues could reach USD 135 billion and account for 7.5 percent of GDP by 2033. These efforts align with the World Travel and Tourism Council’s projections.

In this context, branding is an important step on the road to the future. Transferring the know-how of foreign brands to our country contributes significantly to the transformation of tourism. I would also like to emphasize the importance of increasing the number of our local brands and expanding them abroad. Türkiye has 67 hotel chains, including 46 domestic and 21 foreign, with a total capacity of 157,000 beds. Domestic chains operate only 30 hotels abroad. It is striking that only 8 percent of the bed capacity in our country, which ranks 4th in global tourism, is branded. However, increasing the presence of more brands from such a large tourism country abroad will boost our brand awareness and further increase our revenues. With over USD 100 billion in services exports, tourism sector enterprises – classified as “exporters” under the Tourism Incentive Law No. 2634 and service exporters under other legislation – should receive the same level of support currently provided to the manufacturing sector.

This support is essential to enhance their international competitiveness and enable them to compete effectively with global tourism players. The tourism sector currently does not benefit from supports such as VAT refunds, inward processing regimes, and fair support, which together account for approximately 7 percent of exports worth USD 255 billion. Since June 2, 2015, the sector as a whole should be included in the Money, Credit, and Coordination Board’s 2015/8 “Decision on Supporting Foreign Currency Earning Service Trade”, which has so far only benefited health tourism businesses. The sector should also gain access to marketing, promotion, and consultancy supports. The tourism sector is of strategic importance for the country’s foreign exchange earnings and employment generation. As the only sector to meet its 2023 targets, we are confident that with continued support, we can further strengthen our global market position and set new records in tourism.