Minister not daunted by hotel occupancy results

Tourism Minister Francis Zammit Dimech yesterday said he was concerned but not alarmed by the dismal results shown in the latest hotel occupancy survey.

Yet, despite the seemingly unpleasant tourism situation, government is reluctant to inject more money into advertising.

The results published by the Malta Hotels and Restaurants Association (MHRA) on Friday showed that hotel occupancy during the first quarter of this year was three per cent down when compared with the same period last year.

Dr Zammit Dimech refused to be taken aback by the survey which revealed among other things that the hotel industry had reported a gross operating loss of 21 per cent compared with a loss of 13 per cent during the same period last year.

Pointing out that he would always avoid pessimistic attitudes, the minister stressed that all tourism players were working hand in hand to reverse the downward trend - and there were already encouraging signs.

For example, tourism expenditure between January and April was up by four per cent compared to the same period last year.

The minister said however he was concerned with the hotel room rate dilution and appealed to operators to refrain from bringing rates down further. Dr Zammit Dimech remained non-committal over whether government would grant more funds to advertising, a day after MHRA president Winston Zahra appealed to government to inject a further Lm1 million into marketing.

The Malta Tourism Authority was forced to use its autumn budget to bolster its summer campaign and was now in desperate need of more funding, according to the MHRA.

Minister Zammit Dimech and MTA officials recently held a meeting with Finance Minister John Dalli to discuss the financial situation.

The parties agreed that they would re-discuss the situation after the summer to see whether a further contingency plan was needed.

The MTA has in the meantime been urged to restructure its budgetary allocations as much as possible, Dr Zammit Dimech said.

He said one had to keep in mind that government pumped in Lm6 million into the MTA in the last year, Lm2 million of which were directed towards advertising.

"When government budgets, it looks at all the sectors in detail. I can only augur there will be more money allocation for tourism, especially considering that money invested in tourism is normally ploughed back into the economy," said the Tourism Minister.