Hossam El-Shaer, chairperson of Blue Sky Travel Agency, said that the company’s revenues dropped by a quarter in 2016 compared to 2015.
He attributed the fall to the low tourism inflow from Europe, following the tragic incident of the Metrojet Russian airliner crash at the end of October 2015.
The incident has prompted Russia to halt all its flights to Egyptian tourist destinations from November 2015 onward, while Britain stopped its flights to and from Sharm El-Sheikh.
Blue Sky is one of the major Egyptian companies operating in foreign tourism. It is also an agent for Thomas Cook Travel in Egypt.
El-Shaer said that he hopes 2017 will see better inflow compared to previous years.
Inbound tourism to Egypt has dropped in 2016 to 5.3 million tourists, down from 9.3 million in 2015—a fall of 40%.
The company owns about 20 hotels and floating hotels in all Egyptian tourism destinations, especially in the Red Sea area, South Sinai, Luxor, and Aswan.
El-Shaer said that the company stopped the establishment of three hotels in Sharm El-Sheikh worth EGP 1bn, as well as another hotel in Hurghada that cost EGP 300m.
El-Shaer said that his plan to complete the projects worth EGP 1.3bn will hinge on the return of Russian and British tourism.
He explained that putting the projects on hold was mainly due to the lack of tourism inflow, as well as the high costs.
He pointed out that the current problems will double the company’s losses and put more financial burdens on them, especially because government bodies do not take the current circumstances into consideration.
“The tourism crisis is the worst in years,” El-Shaer said. “Blue Sky has already closed down two of four hotels in Sharm El-Sheikh, in addition to one of five hotels in Hurghada.” He added that the company has also scrapped five of its seven floating hotels, due to the same reasons.