Alanya tourism under currency pressure
Tourism professionals in Alanya are struggling due to exchange rate pressure and rising costs. Facilities using foreign currency loans face the risk of bankruptcy, while competitiveness is declining. Industry representatives emphasize that exchange rate policies need to be reviewed for sustainable tourism.
Hotel operators in Alanya are grappling with economic pressures. The strain on exchange rates, rapidly increasing input costs, and additional burdens caused by inflation pose a serious threat to the profitability of tourism businesses. Tourism professionals point out that profit margins have been steadily decreasing over the past two years, and facilities with foreign currency loans are at significant financial risk.
Industry representatives stress that hoteliers do not want to raise prices under foreign currency agreements but are forced to do so due to rising costs. However, in competing tourist destinations such as Spain, Greece, and Italy, inflation rates are lower than in Turkey, allowing these countries to keep price increases under control. In contrast, Turkey's rapidly rising costs are weakening its competitive edge.
Hoteliers warn that not only increasing accommodation prices but also rising expenses in the region contribute to the perception among tourists that "Turkey is expensive," which could negatively affect tourism preferences in the long run. Additionally, if exchange rates do not rise in parallel with inflation, the cost pressure on hotel operators will increase, potentially leading to a decline in service quality and customer satisfaction.
Alanya's tourism sector representatives argue that in order to maintain sustainable tourism, exchange rate pressures should be alleviated, credit opportunities should be expanded, and inflation should be controlled. Otherwise, the risk of losing competitiveness and a decline in the number of tourists will continue to grow in the long term.
DANGER OF A CHAIN COLLAPSE
Emphasizing that tourism regions are trapped in an exchange rate crisis, Eray Erdem stated:
"Especially in the last two years, profitability in the tourism sector has decreased alarmingly. Necessary steps must be taken to free the sector from exchange rate pressure. If this pressure continues, many tourism facilities that use foreign currency loans will face the risk of bankruptcy."
Erdem pointed out that tourism profitability has dropped from 30–40% to 8–10% and that credit restrictions are tying the hands of tourism entrepreneurs. He warned that a chain of bankruptcies would hit both banks and the tourism sector, emphasizing the need to abandon exchange rate pressure policies and reintroduce financial support.
THE EXCHANGE RATE SHOULD NOT BE HIGH, BUT COSTS SHOULD NOT INCREASE EITHER
Burhan Sili, President of the Alanya Touristic Operators Association (ALTİD), stated that no occupancy problems are expected for the 2025 season. However, he warned that declining profitability could cause serious difficulties for small and medium-sized facilities.
"In 2025, there seems to be no numerical problem. We anticipate that our hotels will be full, and in this sense, we expect a good season. However, as we have emphasized from the beginning, increasing costs and the current exchange rate policy have led to a significant decline in profitability in the hospitality sector. Our main demand is that the exchange rate should not be too high, but costs should also not rise. Otherwise, small and medium-sized hotels could face serious profitability issues, which would harm both tourism and the economy."
COMPETITIVENESS IS WEAKENING
Şükrü Cimrin, a board member of the Turkey Tourism Promotion and Development Agency (TGA) and the Alanya Tourism Promotion Foundation (ALTAV), stated that hotels do not want to increase prices in foreign currency but are forced to do so due to rising costs.
Cimrin said: "Hotel operators do not want to raise prices in their foreign currency agreements, but they are forced to do so because rising input costs outpace exchange rate increases. Every price hike in foreign currency weakens our competitiveness against Spain, Greece, Italy, and other Mediterranean destinations. Since inflation in these competitor countries is much lower than ours, they have not increased prices as aggressively as we have over the past three years. Tourists are becoming less willing to accept price increases that result not from better quality and service, but from rising costs. This is one of the biggest challenges we face. If exchange rates increase, it will ease the pressure on hoteliers and prevent the need for forced price hikes. However, costs must not rise at the same rate—meaning inflation must be brought under control. If both exchange rates and costs rise simultaneously, it will only provide temporary relief. Apart from package tour prices, another factor contributing to the perception of Turkey as an expensive destination is the increasing cost of expenses on-site. For instance, if a tourist has to pay more euros every year for the same beer outside the hotel, this reinforces the idea that Turkey is becoming more expensive."
SERVICE QUALITY AT RISK
Ali Orkan, President of the Konaklı Touristic Operators Association (KONTİD), pointed out that the exchange rate increase lags behind inflation, eroding hotel profit margins and negatively affecting service quality.
Orkan stated: "One of the biggest issues for the tourism sector last season was the stable exchange rate. While exchange rates increased by about 30%, input costs surged by 70% due to inflation. As a result, hotel profit margins have dropped to minimal levels. When businesses operate at a loss, the quality of service inevitably suffers. This leads to guest dissatisfaction and an increase in complaints, which in turn could result in a decline in tourist arrivals."
