Romanian seaside tourism business to exceed RON 1.5 bn, new maximum in 2017

Romanian seaside tourism turnover, from hotels to restaurants and bars will surpass RON 1.5 billion this year, almost doubling in the last five years, KeysFin study on HORECA reveals.

“Increasing population disposable income, higher standards of living, improved payment facilities, all these conditions are met so that 2017 would most probably be the best year in the last decade for Romanian tourism,” said KeysFin analysts.

There were almost 900 accommodation units on the Romanian seaside, in 2016, of which 335 hotels, 243 villas, 164 bungalows, 31 bed & breakfast and 56 hostels. Most of them were in Eforie (201), Mangalia (177), Costinesti (154) and Constanta-Mamaia (135).

2,781 active companies headquartered in Constanta and Tulcea were registered with the Trade Registry and Ministry of Finance in the same period, of which most provided restaurant services (1106) and bars (779) while other 424 companies had as main scope of business hotel accommodation services.

The statistical data shows that the seaside business has significantly increased in recent years, from RON 801.2 million in 2012 to RON 1.33 billion in 2016. Also, the profitability of the sector has increased from RON 44.9 million to RON 205.8 million in the same interval.

Between 2012 and 2016, the companies headquartered on the seaside went from one extreme to the other, with the net result (including losses) ranging from – RON 37.9 million in 2012 to a plus of RON 132.9 million in 2016. Relevant, in this context is the advance of the operating profit which increased from RON 71.6 million to RON 250.8 million in 2016.

“The tourism business on the seaside grew sustainably in recent years, a sign that more and more tourists have seen the Romanian seaside resorts as an increasingly attractive destination, due to the significant investment in the development of accommodation and dinning units, from hotels and hostels to restaurants and bars,” said KeysFin analysts.

The favourable evolution was also supported by the completion of the A2 highway, but also by the international context, the economic crisis in Greece and Turkey’s terrorism incidents influencing significantly the decisions of Romanian tourists to spend their summer holidays on the domestic Black Sea Coast.

Using INS data, KeysFin study shows that the number of tourists registered in licensed accommodation units (excluding hosts and other unauthorized units) exceeded 1.23 million last year, more than 200,000 more than in 2015. Most tourists were Romanian, 1.11 million in 2016, while foreigners accounted for only 6.3 percent (78,275 tourists).

Despite the positive seaside domestic trends, generally Romanian tourism is still far below its potential. Evidence of that stands the statistical data at European level, which ranks Romania last in the EU with regard to the share of tourism receipts in the gross domestic product. If in Malta, Cyprus and Croatia, tourism accounts for over 12 percent of GDP, Romania reports a contribution of only 1 percent of GDP.

“Bulgaria is the best example of efficient tourism exploitation. It contributes with 5 percent of GDP despite a tourism potential that is below the Romanian one. Our southern neighbours have been able to attract better investments, especially foreign ones and to better profit from the geopolitical crisis in Turkey and Greece,” said KeysFin experts.

In order to reduce the gap, Romania needs to invest primarily in the transport infrastructure and in the alignment of accommodation facilities to international standards.

“The opening of new five-star units on the seaside, such as the Phoenicia Royal in Navodari, is a step forward, but we still have problems with car, air and rail traffic to the resorts, with the quality of accommodation and dining, and especially with the professionalism of employees in the sector,” KeysFin experts say.