Amid the lunchtime rush at a nearly 100-year-old restaurant in Istanbul’s famous Sultanahmet district, French tourist Isabelle Laval indulged in one of Turkey’s national dishes, “kofte,” meatballs made of beef or lamb. The eatery wasn’t always so packed. Visits plunged two years ago after a suicide bomber killed 12 German tourists across the street. “If you keep thinking of this, you don’t do anything,” Laval told The Media Line. For many, though, a wave of terrorist attacks coupled with a 2016 coup attempt was reason enough to vacation elsewhere.
“It was the worst year of our business but not just for our business, but for all of those [in] Turkey,” Mert Tezcakin, whose great-grandfather founded Sultanahmet Köftecisi, told The Media Line. Some of the terrorist attacks specifically targeted the tourism industry, including one on Istanbul’s Ataturk Airport that killed 45 people in 2016.
The tourism industry was down 7.6 billion euros that year compared to 2015, and Turkey’s overall GDP decreased by nearly one percent. Without a major terrorist attack in Istanbul over the past year, the tourism sector is bouncing back; this, in stark contrast to the rest of Turkey’s sluggish economy.
Tezcakin, who is CEO of his family business, estimated there has been an increase between 30 to 40 percent in tourists visiting the restaurant.
The Turkish Statistical Institute announced last week a 30% year-on-year increase in tourism income between April and June.
The Association of Turkish Travel Agencies (TURSAB) wrote in an email to The Media Line that during the decline, it focused on attracting visitors from new markets such as China, India and Latin America, which led to the amount of tourists doubling from these areas.
“Turkish tourism sector has proven its resilience,” TURSAB wrote. The association predicted there would be 40 million visitors and $32 billion in tourism revenue for the whole year. TURSAB added that there was a 24 percent increase year-on-year in U.S. visitors, from about 152,500 in the first half of 2017 to 189,680 in the first half of 2018.
The improving figures come despite a grim forecast for the economy. Turkey’s central bank announced last week it was increasing this year’s estimated inflation rate from 8.4% to 13.4%. The currency, meanwhile, has plummeted 27 percent this year. After Erdogan won re-election in June, he appointed his son-in-law as the finance minister, leading to fears over the independence of Turkey’s monetary policy.
Poor relations with the West have also contributed to the currency’s free-fall. The lira dropped dramatically in anticipation of sanctions imposed by the U.S. over Turkey’s detention of American pastor Andrew Brunson, who was imprisoned for nearly two years and is now under house arrest.
The currency decreased even further on Monday after the U.S. announced it would be reviewing Turkey’s duty-free access to the American market.
While the lira rose slightly following local reports that officials from both sides would meet in Washington later this week, the currency is still at a record low relative to the greenback.
The increase in tourism may not be the economy’s saving grace in the long-run. The main source of tourists is now Russia with a GDP per capita of $10,700 in 2017, pushing Germany with a GDP per capita of $44,400 to second place. That means that some of the tourists who are coming have less to spend.
The average amount that foreign visitors spent in the second quarter of 2018 was $602 compared to $715 over the course of 2015.
One area within tourism that is showing an upswing is flights from Israel. Joseph Fischer, a tourism consultant for over 30 years who used to focus on Israeli-Turkish travel, noted that Turkish Airlines was adding another daily flight between Tel Aviv and Istanbul.
That would bring the total number of daily flights for all carriers to 14, he said, although many use Istanbul as a hub to other destinations.
Fischer said there were 250,000 Israelis who visited Turkey last year, despite ongoing political tensions between the two countries.
“Eighty-five percent are probably really tourists, people who go to Antalya on an all-exclusive package and people who go to Istanbul for shopping.”
Back at the restaurant, Tezcakin said his business feels the effects of rising inflation and expressed concern that the economy will continue to struggle.
“Piece by piece, everything increases,” he said. “We need to be prepared.”