The travel industry has been warned not to overreact to the financial crisis in Greece.
Speaking at the sixth Abta Travel Matters UK conference held in London yesterday, Graham Pickett, Deloitte lead partner – travel, hospitality and leisure, said he expected the European Union to “muddle through”.
“What I do not want to see is this industry panicking and moving routes or plans and announcing that to the consumer at large because that’s not going to be helpful,” he said.
Pickett said economically Greece and the Euro was never going to work and that the only reason the country will stay in the single currency is political. “Greece is always going to be a problem – it’s never been good at tax collecting,” Pickett said.
He saw three possible outcomes to Greece’s negotiations over its debt: the creditors’ demands are watered down and a deal is reached; a deal is reached with severe restrictions or there is no deal, or Greece defaults and comes out of the euro – the last of which he described as a catastrophe.
Andrew Swaffield, Monarch Group chief executive, said the biggest risk related to Greece was a “self-imposed knee-jerk reaction”, with airlines moving capacity to an alternative destination like Spain, prompting prices to collapse and leaving Greece with too little capacity for demand.
He said this would “create a crisis of a much bigger magnitude”.
“If we are careful and we don’t overreact then the Greece situation can be relatively well-managed. There is a history of airlines tending to overreact and moving their capacity too quickly. We would certainly be looking to support Greece and not overreact.”
Abta chairman Noel Josephides said that in 42 years of tour operating to Greece he has never known the country not to have problems, but that he was sure they would “find a fudge” for their issues for 42 years to come. He urged delegates not to be afraid to book to attend the next Abta Travel Convention which is being hosted in Greece.
Abta chief executive, Mark Tanzer, said: “it’s a very unusual situation, but the travel industry in the UK is used to dealing with unusual situations and we will deal with it in the way we have to. We are confident we can handle that, whatever the situation is.”
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