ICPAC’s crucial role in the development of the tourism industry

The development and implementation of strategies for the realization of goals in the short, medium and long term has always been important for societies and has always contributed to their development. In the modern era, these strategies not only retain their value and importance, but have a powerful impact on socio-economic development. Detecting and meeting goals in a globalized environment has become more complex. But fortunately, today there are more tools, metrics and data at our disposal. All the above, if used correctly, lead to more targeted, data-driven and ultimately successful strategies. The pandemic has speeded up new trends and highlighted even more the importance of having flexibility to be able to adapt to the new behaviours at short notice. And if we accept that the pandemic “taught us a lesson” then we can say that the turmoil that Russia's invasion of Ukraine caused and continues to cause further important considerations that need to be addressed. Since then, economies have been called upon to survive amid unprecedented conditions and a host of consecutive, diverse and multi-faceted challenges that have important socioeconomic impact at both local and global level. Under these conditions, the tourism industry is called upon to cope and continue to contribute and grow. In this context and recognizing, exactly, this need, the Institute of Certified Public Accountants of Cyprus (ICPAC) has established a new technical committee to address this important part of our economy. This is how the Hospitality Industry Committee was created, which I chair. It is important to point out that the technical committees are established and operate with the aim to provide expertise, mainly, on specialized financial matters, which concern specific sectors at a macro and micro level. In the hospitality sector, many members of ICPAC are employed, at various levels and with various specialties, which underlines the necessity to support the sector through this new Commission, especially in the current, extremely difficult time.

It is therefore important to capture the impact that the tourism industry has on the country's GDP. Its contribution is extremely important for the Cypriot economy and its development; hence its losses were measurable during the pandemic period of strict measures and lockdowns. The tourism industry took a big hit in 2020, by which time an otherwise promising tourism season had been destroyed, following the best-ever in 2019. In 2021, the reflexes worked as much as the restrictive measures for COVID-19 allowed, and the tourism industry in Cyprus managed to take some necessary breaths for its survival.

Coming to 2022 we observe that the available data so far indicate significant improvement. Both arrivals and revenues are bouncing back in the absence of strict restrictive measures. However, the Ukrainian issue and the sanctions against Russia that followed have significantly affected Cypriot tourism as they resulted in the loss of the second most important market, that of Russia, but also the smaller market of Ukraine.

According to the results of the Travelers Survey, which is carried out by the Cyprus Statistical Service, the income from tourism in July 2022 alone amounted to €381.7 million compared to €245.7 million recorded during July 2021, marking an increase of 55.4%. The improvement is reflected even more clearly in the statistics for the period January – July 2022, when tourism revenues are estimated at €1,217.4 million compared to just €504.5 million in the corresponding period of 2021. In the same seven months of 2020 the income from tourism was only €164.5 million.

If we look at tourist arrivals, there is an increase of 40.2% in August 2022 compared to August 2021. In real numbers, arrivals last August were 451,133, compared to 321,858 in August 2021. For the period January – August 2022, tourist arrivals reached 2,127,172 compared to 960,150 in the corresponding period of 2021. The same period of 2020 brought just 424,850 arrivals, while 2,735,839 arrivals were recorded in the pre-pandemic period of January – August 2019. The main source of tourism is the market of United Kingdom. Quoting the statistics and given the importance of the tourism sector for the Cypriot economy, the need for the establishment of the competent ICPAC Committee was obvious. Our target is to be in constant communication and consultation with the Deputy Ministry of Tourism and the sector’s stakeholders, with a mandate to contribute to the further development of the sector. In the modern age of technology and data analytics, Cyprus, a tourist destination par excellence, cannot lag in the compilation and utilization of useful statistics. The analysis of data can lead us to smart solutions and unlock perspectives through the improvement of our tourism product, the better targeting of marketing actions, the improvement of the services provided and to the so much needed in today’s world transparency.

Through the newly established committee, we have the opportunity to cooperate with the other ICPAC Committees in order to bring the tourism industry on a par of the international accounting standards and to utilize the power, resources and reliability of qualified accountants.

ICPAC has the potential to play a vital role as the most competent body to produce in depth analysis (accounting, auditing, statistical analysis and interpretation) for the formulation of opinions and recommendations that can contribute to addressing challenges and creating perspectives. Our target is to submit innovative ideas and have a decisive contribution to the improvement of the performance of strategies, for the most vital sector of the local economy which is currently going a major reshuffling globally. All these for the benefit of the public sector, the private sector and, society in general.