There has been much self-congratulation in the corridors of Israel's Ministry of Tourism in recent weeks, after it was announced that a record 4,120,800 tourists visited the country in 2018, up 14% from 2017. Despite this ostensible success, it is a sobering thought that some of our neighbors are doing far better and also enjoyed record figures last year.
In 2018, a whopping 33 million tourists visited Greece, up 10.6% from 2017,
On the face of it, the fact that over eight tourists came to Greece, for every one that visited Israel, suggests that Israel's tourist industry is failing badly to live up to its potential.
Israel and Greece are similar sized countries in terms of population. Israel has 9 million citizens and Greece has 10.77 million.
But Greece has some obvious advantages. Firstly it is over six times larger in geographical terms, with 131,957 square kilometers compared with Israel's 22,072 square kilometers and between the mainland and the many islands has hundreds of kilometers of coastlines and beaches.
But what Israel lacks in geographical quantity it makes up for in quality. Israel is further south than Greece and offers higher temperatures and more sunshine in winter, especially in Eilat. Israeli is also more geographically diverse with desert and forest landscapes, the uniqueness of the Dead Sea, the lowest point on earth, and much more. Most significantly, while Greece is rich in history and archeology, Israel has all that and more and is the Holy Land with a diverse range of sacred sites in Jerusalem, the Galilee and elsewhere. In recent years, Tel Aviv has emerged as one of the world's trendiest cities and Haifa has gems like the Bahai Gardens.
Secondly, Greece is a hell of a lot cheaper than Israel. Greece's per capita GDP is $20,930 while Israel's is more than double at $43,200. The greater expense is exacerbated by the fact that Israel is much further away from Western Europe than Greece making air fares far higher, while the French and Germans also have cheaper overland bus options.
Of course attracting so many shoestring budget travelers does have a downside for Greece compared with Israel. Greece's 33 million tourists earned the country $18.5 billion in revenue in 2018 while Israel's 4.1 million visitors brought in $5.8 billion last year. In other words, Greece earned just $560 per tourist compared with Israel's $1,410. Besides, New York, London and Paris are no cheaper than Israel and each city manages to attract tens of millions of visitors each year.
Another critical factor inhibiting Israel's tourist industry is the country's precarious geopolitical position. Israel is perceived as a target for terrorism and every few years missiles rain down on the country from Gaza or Lebanon. Israel's diplomatic isolation and its human rights image as depicted by BDS activists are a further handicap.
The failure of a concerted BDS campaign to make any dent on the Eurovision final in Tel Aviv in May suggests that these disadvantages can be overcome.
In Greece, the government provides a package of assistance and incentives for the construction of new hotels and tourist developments. Just this week, the Greek government announced €200 million in help for small and medium enterprises (SMEs) engaged in tourism.
The Israeli government does have a budget to promote tourism and for example pays airlines $70 for every passenger brought to Ovda Airport (soon to be replaced by Eilat's new airport) - a budget of $8.25 million in 2018. Airlines also receive a grant of €750,000 for launching routes from Israel to destinations not yet served by any other carrier.
Arguably, this is all small change from a government, which has much bigger coffers than the Greeks. But then Israel also has other options. Why spend €200 million in help for small and medium enterprises (SMEs) engaged in tourism, when the same money invested in high-tech startups would probably produce much bigger returns.
Nevertheless, diversity in economic matters is always a good thing and while it make sense to extract as much as possible from Israel's high-tech golden egg, it would also make sense to focus more on maximizing the country's huge tourism potential.
Published by Globes [online], Israel business news - en.globes.co.il - on February 12, 2019
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