Hard knock tourism: Prague hotels report a 70% drop in sales

Tourism is one of the sectors suffering the most from the current crisis. It is the most severe in the big cities, led by Prague, where sales have fallen by 70 percent. According to the Association of Hotels and Restaurants of the Czech Republic (AHR), unless the government quickly launches a coursework program for tourism entrepreneurs to retain existing staff, there is a risk of further collapse in the coming months.

The drop in sales in Prague is 70 percent compared to last year, which was already marked by the pandemic. “In this situation, the government has resigned itself to any form of direct support for entrepreneurs and has not yet activated the promised coursework, which was approved for this very purpose,” said Václav Stárek, president of the AHR ČR, commenting on the situation.

According to the AHR, hotels in large cities have achieved an average occupancy rate of around 20 percent for a long time. Prague is the worst off, with 18 percent in June and July. According to AHR, four- and five-star hotels in Prague had an occupancy rate of 9.9 percent in the first half of this year, compared to 26 percent last year. Before the coronavirus pandemic, it was at 75 percent during this period.

There are also concerns as the autumn months approach when insurance companies will no longer reimburse for covid tests. “Tourism has great potential to develop the standard of living of the people and has been bringing up to 41c of every hundred crowns spent by a tourist to the public budget. If the government continues to ignore any effective assistance to entrepreneurs in the sector, the tourism industry faces further collapse in the coming months, ” Stárek added.

In general, however, there has been an increase in the Czech Republic compared to last year. According to the Czech Statistical Office, the number of guests staying in mass accommodation facilities reached 1 568 453 people in the second quarter of this year. This is 51.3 percent more than last year.

There is a lack of foreign tourists

“Thanks to the low comparison base, the tourism results for the second quarter of this year look outstanding. The number of guests has shown huge growth, and other indicators also look fantastic in a year-on-year comparison. However, the reality is that tourism is recovering from such a hard knock that even increases of tens of percent are not enough to recover this severely tested sector of our economy, ” says BHS chief economist Stepan Křeček.

Tourist destinations traditionally busy with domestic tourists are on average 60 percent occupied over the summer but expect further drops in occupancy from September, which operators estimate at 30 to 40 percent. In addition, in places where tourists visit in the summer, there is a problem with a shortage of workers, for whom tourism and hospitality have become a generally risky industry.

In the second quarter of this year, the Czech Republic received the most foreign visitors from Germany and Slovakia. Guests from Poland followed in third place by a wide margin. The top ten most frequent foreign guests are only from Europe. The only exception is guests from the United States, in ninth place. No one from Asian countries made it into the top ten.