On July 21, two weeks into Operation Protective Edge, Israel’s already battered and bruised tourism sector was dealt what could have been a final blow.
Hamas rockets, which had been hurtling through Israel skies all summer long, had now come dangerously close to Israel’s Ben-Gurion Airport, with one landing in Yehud, a town in central Israel whose borders graze the buffer zone that experts felt had to remain rocket-free for flights to take off and land safely. Delta, US Airways and United all promptly nixed their flights, and the United States’ Federal Aviation Administration, citing an abundance of caution, soon blocked all US air travel to Tel Aviv for a period of 24 hours. A number of European air carriers followed suit.
The decision could not have come at a worse time for the Israeli tourism industry. War is always devastating for tourism, but a war that comes at the height of summer is especially painful. Summer is when children are off from school, synagogue and Jewish community groups are planning missions in droves, and Israel’s beaches and outdoor spaces are at the best and brightest. It’s the height of tourist season, and the flying missiles and wailing air-raid sirens had already caused millions of shekels of lost tourism revenue. The sealed air space felt like the kiss of death.
It was no surprise, then, when a few days later Tourism Minister Uzi Landau kicked off a massive tourism campaign called “Precisely Now: A Vacation in Israel,” encouraging Israelis to book hotel getaways around the country at rock-bottom prices. The packages, which range between NIS 350 per couple per night and NIS 900 per couple per night, are good through the end of 2014. The caveat, however? They must be booked now.
“We are fighting on two fronts in this war – the military front, with our finest conscripted and reserve soldiers, and the economic front, in which every citizen in Israel is engaged, either as employees who are driving the economy or as consumers in every branch of the economy,” Landau said.
The NIS 6.2 million ($1.8 million) campaign, which is being run by the Tourism Ministry in cooperation with the tourism associations, the Israel Hotels Association, the Israel Tour Guides Association and several municipalities across Israel, kicked off on July 31 and runs through the beginning of September.
By then, tourism execs say, they hope the outlook will be very different. And there is reason to be cautiously optimistic. The flight ban, which was assailed by Israeli officials as both utterly unnecessary and granting a reward to terror, was lifted after 48 tense hours. And if Israeli businesses are skilled at one thing, it’s bouncing back after conflict.
“Through the past month, we have basically been preparing for the day after,” says Pini Shani, who heads up marketing administration for the Tourism Ministry. “We’re gong to initiate a few massive campaigns, worth about 3 billion euro, in Russia, more or less the same amount in Germany, and a bit less in France, Italy and the UK … we are going to provide very good deals, and promote it heavily.”
Shani says the Tourism Ministry does not yet have a final number for how much money was lost in July and August due to cancellations on hotels and trips. The toll is still being tallied, but right now “we know it’s a major number,” he says. “The main question, though, is what the future will bring. We lost a month, but the question is if the damage will continue for six months, or twelve months — then that number is much larger.”
At this point, two days into a fragile three-day ceasefire that appears to be holding, it’s possible that the war is, indeed over. Industry experts estimate that when Shani does have a number, it will be in the realm of $600 million to $700 million lost, with the hotel industry alone taking a hit of between $300 million and $350 million. Many Israeli hotels, especially those in Tel Aviv and Jerusalem, enjoy occupancy rates of nearly 100 percent in the hot summer months, but this year they saw more than half their beds go empty.
“First as a citizen, and secondly from the business point of view, it’s been a very difficult summer,” says Rafi Baeri, VP of sales and marketing for Dan Hotels, the largest luxury hotel chain in Israel. “We’re not saying it was a tough summer, we’re saying it is a tough summer. Because in tourism, unlike in many other businesses, things have a longer term effect.”
Baeri says that cancellations at the chain, which includes the Dan Tel Aviv, the Dan Gardens Ashkelon, the Dan Panorama Haifa and the iconic King David hotel in Jerusalem, have hit reservations through September. But he remains optimistic that things will bounce back as the weather, and the conflict, cools off.
“We will get back all the businesspeople that shied away in July,” he says. “They are coming back. And many of the groups that have booked have not canceled, although we might see some reduction in the size of groups. I think we’ll continue to feel the aftereffects [of the conflict] all the way through the hagim [the autumn Jewish holiday season], so through October, and I hope that after that, things will return to normal.”
This war, of course, dragged on much longer than anyone on the ground seemed to expect, and with Hamas threatening to resume hostilities on Friday morning at the expiration of the 72-hour ceasefire, it’s impossible, at this moment, to be too certain of anything.
“Uncertainty has a lot of psychological effects,” Baeri admits. “It’s not that Israel is damaged, the tourism route has been ruined and you can’t tour the country. Everything is normal here. But psychologically, people want to be sure things are quiet.”