The Strategist

Economic Impact of the Terrorist Attacks in Paris

11/16/2015 - 15:44

The attacks on November 13 in Paris that killed 129 people, could seriously affect the French tourist industry, which is crucial to the country.

Poulpy - Eigenes Werk
Poulpy - Eigenes Werk
"There will be difficult times for tourism. The sector is going to suffer ", - Reuters quoted Head of the consulting agency MKG Group Georges Panayotis. France is the world leader in the number of foreign tourists. According to the World Tourism Organization, 83.7 million people had visited the country by the end of 2014. During their stay, they had spent € 150 billion. Tourism accounts for 7.5% of national GDP. For the first six months, 7.5 million of tourists have already visited Paris (data of City Department of Tourism & Conventions). In September and October, hotel business showed good results because of the international activities as well.

Hoteliers hoped that the international climate conference COP21 (which will last 12 days, from 30 November to 11 December) would have ensured a good occupancy rate. At least 50 thousand people were expected to arrive, yet now experts believe that many will refuse to participate in the event.

Luxury hotels, in particular, are going to have especially hard times. «The context of security and geopolitics" is important for guests of hotels like Bristol, Georges V and Plaza Athenee, says Panayotis.

Drop in demand is fueled by reports on tour operators cancelling trips to Paris. So did the Japanese tour operator JTB, Belgium TO Jetair, Sunjets, and Thomas Cook asked its customers asking if they wish to cancel a trip to the French capital. The industry participants have not yet announced any estimates of the possible fall of the tourist traffic in France. "It's too early to talk about how to obtain reliable information," - said representative of the Paris Office of Tourism & Conventions Véronique Potelet Anty.

In January, when the Islamists shot Charlie Hebdo’s office, the occupancy rate of hotels in Paris, according to MKG Group, fell by 3-5% in the first days after the attack, and 10% in the following week. In the first six months of 2015, 1.8% fewer tourists came into Paris, comparing to the same period last year, according to data of the Paris Office of Tourism & Conventions.

A series of terrorist attacks took place in Paris and the suburbs on Saturday night. The tragedy killed 129 people and wounded hundreds.

The scale of the bombings and shooting at peaceful people, occurred almost simultaneously in Paris, plunged France into state of shock.

Today's attacks were the largest in Europe after the Madrid bombings in 2004.

French President Francois Hollande called the attack an "act of war", organized by militants of the extremist group "Islamic State".