Coronavirus pandemic has given a surprising opportunity for the development and strengthening of domestic tourism. But whether Kazakhstanis will go on vacation within the country after its end mainly depends on business restructuring.
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Tourism in Kazakhstan, just like in the rest of the world, was one of the most affected sectors of economy, the first one. According to Rashida Shaikenova, director of the Kazakhstan Tourist Association (KTA), who spoke at the online briefing regarding the situation in the sector, it stopped working in the second half of January, when various countries started introducing quarantine measures to respond to the spread of coronavirus, banned travel and closed borders. She estimated the losses in the travel industry as one hundred per cent.
According to the Association of Tour Operators of Kazakhstan, the amount of losses on cancelled tours in outbound tourism (Thailand, UAE, Egypt, Sri Lanka, India) in February-April 2020 was almost 4.8 billion tenge (11.8 million dollars). The losses in the inbound tourism due to the pandemic, according to the chair of the Travel Industry Committee of the ministry of culture and sport, Dastan Ryspekov, will be 70-80 per cent this year compared to the last year’s figures. In 2019, the volume of export travel services was 2.5 billion dollars.
According to the results of survey by KTA, 45.8 per cent of staff of travel agencies, tour operators, air travel bureaus and insurance companies are on unpaid leaves now. 4.7 per cent of employees were dismissed, 49.5 per cent came to work.
The survey held by the Kazakhstan Association of Hotels and Restaurants showed that 62.2 per cent of surveyed hotels reduced their staff by 10-50 per cent from March to May, during the emergency regime. After the activity was resumed, about 30 per cent of employees came back to work, 20 per cent were dismissed, 50 per cent are on unpaid leaves, the hotel room capacity is now below 10 per cent.
Peculiarities of the 2020 season
Travel agent Roza Yesenkulova who has been engaged in outbound tourism said that their company has not sold a single tour abroad from the beginning of the emergency regime, from March to June.
“Usually, people book summer tours in winter and early spring. In January-April, we had good sales for summer and even autumn. Kazakhstanis used to book early, used our offers and deals, received discounts, bonuses, gifts and best places in good hotels,” she said.
Although people are interested, ask to calculate the tour price, and even buy tours since recently, it’s unlikely that there will be mass booking, she said.
International flights to Turkey resumed on June 20 were actually the start of outbound tourism this season. However, on July 3, it became known that Turkey closed the border for Kazakhstanis for two weeks. As reported on the website of the national air carrier Air Astana, the Turkish authorities informed that Kazakhstan’s citizens would be temporarily banned from entering Turkey. The reason was the quarantine announced in Kazakhstan on July 2. The restriction on the entry of Kazakhstani citizens into Turkey since July 4 was confirmed at a briefing in the Central Communications Service under the President of the Republic of Kazakhstan by Talgat Lastaev, Chairman of the Civil Aviation Committee of the Ministry of Industry and Infrastructure Development of the Republic of Kazakhstan. However, regardless of the time the restriction was lifted, the current season will be very different from the previous ones.
There will be fewer receiving hotels – they need to be certified for compliance with health standards, availability of the necessary number of staff to serve the guests, ensuring conditions for social distancing, for example, arrangement of beach chairs at least two meters away from each other.
According to travel operators, Turkey and Egypt passed certification and are ready to receive tourists according to the new rules of premium hotels.
“Four-star and ordinary economic “five star” hotels may remain unchosen. I doubt there would be low-cost rest on the so-called “last-minute” flight deals. Earlier one could take the cheapest trip, but there are no guarantees that the hotel would accept you now. It all depends on the certification,” Yesenkulova said.
Package tours did not become expensive – they are sold at contractual prices agreed at the end of last year. According to her, a week of rest under the all inclusive system in Egypt will cost nearly 200-250 thousand tenge (492-615 dollars) per person and in Turkey – 300-400 thousand tenge (738-984 dollars).
The price of tours is not higher than that of early booking, the travel agent said, but it is a common phenomenon.
“This year we didn’t not have early booking,” she said. “It was postponed and is available only now. One can get a tour for August at a favourable price.”
Regular flight tours depend on the tariffs of the airline.
“For example, there are no charter flights to Tbilisi and many other places,” Yesenkulova said. “Air tickets are being sold on actual basis and their prices are not fixed.”
For any taste and budget
Because of closed borders, Kazakhstanis started to recreate within the country. According to Roza Yesenkulova, there’s a high demand for resorts in Alakol, trips to holy places in Turkestan region, mountains in Eastern Kazakhstan region, plains of Mangistau.
Kazakh Tourism national company said that Mangistau, Alakol, Burabai and Turkestan are now the focus of attention of Kazakhstanis. Resort zones of Shalkar-Imantau, Bayanaul, Lake Balkhash, Nur-Sultan, Baikonur and Almaty mountain cluster are now popular travel destinations. Deputy director of KTA Klara Mamutova said there is a stable demand for Alakol and weekend tours to Kolsai lakes and Charyn.
According to experts, Rixos Aktau hotel located at the coast of the Caspian Sea is now in great demand. It opens on July 13 and, as stated, will become the first and the only five-star hotel in Central Asia with the all-inclusive system. Moreover, it is already called the alternative to Turkish resorts. Tours to this hotel from Almaty for 6 days/5 nights per person, according to one of the travel agencies, start from 384 thousand tenge (945 dollars).
A TV story of a Kazakhstan TV channel repeated by other media as text saying that the rest in Kazakhstan resorts went up twice draw great response in the travel community. Director of Open Travel Advisory consulting company, Asel Nurkebaeva, called it a hype.
According to her, there was no rise in prices.
“The akimat of Eastern Kazakhstan region confirmed it,” she said. “In Almaty region, all recreation facilities and hotels work at last year’s prices. Despite the fact that they bear disinfection expenses.”
If a restaurant increases the price, it depends on the cost of foodstuffs, Asel Nurkebaeva said. It is not necessarily due to the quarantine.
“An entrepreneur may include their expenses into prices, this is just business,” she said. “But there was no double increase in prices. Businesses hoped to work this season and earn at least during this half of the season. The majority did not even think to increase prices.”
According to KTA, Kazakhstan resorts offer various options of rest in any price segment. For example, Alakol has both premium hotels and affordable resorts. According to the estimates of Kazakh Tourism experts based on the analysis of market offers, a week-long rest at Alakol for two adults and two children in comfortable conditions will cost 350 thousand tenge on average (861 dollars).
Kazakh Tourism admitted the due to the impact of coronavirus, inflation and devaluation on the season, there would be no last year’s prices.
“You should take into account that tourism is a market environment and entrepreneurs consider prices of foodstuffs and other welfare items fixing prices. However, we don’t expect rise in prices as the people’s purchasing power is now decreased,” the company’s press service noted.
More trouble than it’s worth
The founder and director of KazOrg Travel, Rinat Khamidulin, said that the price of their travel packages does not differ from last year’s.
“Many colleagues are not going to raise prices of their services,” he said. “We know that the quarantine hit the pocket of Kazakhstanis and rise in prices is more trouble than it’s worth.”
In particular, the average cost of a popular classic destination to Turkestan per person is 10 thousand tenge (25 dollars). Combined 3-4-day tours, including a visit to Turkestan and sacred places, to mountains, rafting and fishing trip, are in high demand. They will cost 60-80 thousand tenge (148-197 dollars) per person.
The company is initially focused on domestic and inbound tourism and was focused on Kazakhstan consumers mainly. The travel season in the south started traditionally in early spring, in March, on the day of Nauryz. On the average, they had 5 to 15 groups in spring, exclusive of individual tourists.
Director estimated losses of the failed spring season within the range of 500 thousand to 2 million tenge (1,230-4,920 dollars). Also, he emphasised, the company provides service and information and advertising services. If it derived income from tourism only, it would cease to exist during the quarantine. Moreover, they had to drop their plans for 2020 and earlier agreements.
“Coronavirus made its harsh “amendments” to travel businesses and made many of them drop their plans and think of new ideas and offers. The pandemic gives a good chance to domestic travel business to approve themselves,” Khamidulin said.
Domestic “championship”
The head of Kazakh Tourism representative office in Almaty region, Yerkebulan Khasenov, said in the interview to Kazinform that all countries “returned to zero” in terms of tourism and are now in equal status:
Director of a Taraz-based travel company, chair of the Association of Domestic and Inbound Tourism of Zhambyl region, Albina Veimer, in one of her posts on Facebook, proclaimed the era of domestic tourism in Kazakhstan. Tourist patriotism has become a trend in social media.
During the harsh quarantine, Kazakh Tourism launched a challenge on its accounts “Where are you going to first after the quarantine is over?” According to the conditions, a participant should have posted their photo with Kazakhstan as travel destination and recommended a travelling destination to Kazakhstanis.
A range of groups on Facebook is implementing similar initiatives, e.g. “Travelling across Kazakhstan”. Tour operators, guides, visitors post their offers, share their plans of vacation, impressions of places visited, share photos and videos. Almost all posts are full of delight about the beauties of their own country. At the same time, there are negative feedbacks on the level of service, poor logistics, etc.
To keep Kazakhstanis interested in domestic travels after the pandemic, Kazakh Tourism advises that businesses should take into account high seasonal dependence of domestic resorts. They should find solutions to organise rest during off-season, including creation of additional travel products, holding newsworthy events together with local authorities.
“The rise in demand means the rise in the number of offers within Kazakhstan,” Klara Mamutova said. “This will lead to competitive recovery in the market and to better quality of services and reduction of their cost, respectively.”
Based on the market and consumers focus on domestic tourism, KTA held a study among consumers of travel services of Kazakhstan.
As expected, the portraits of consumers represented in the study will let travel companies understand the image of their buyers and determine the age segment that would be interested in their products and if their products would need to be modified. The findings of the study are that Kazakhstan tourists are ready to take a rest in the country in large groups if they have quality and affordable product.
Meanwhile, according to Roza Yesenkulova, domestic destinations are popular temporarily and sea vacations cannot be replaced with local tourism.
“These are different kinds of rest, services, conditions. Rest, sea, beach differ from the rest in Kazakhstan in national parks and reserves. Here we have more of ecotourism, savage and medical tourism. Now we have many offers, new products. However, they are incomparable to beach package deals that the Kazakhstanis got used to,” she said.
Therefore, once the borders are opened, according to the estimates of the travel agent, those who used to travel or planned to travel will travel.
By the way, according to the same KTA study, if borders are opened this summer, 26 per cent of respondents plan to travel abroad. 95 per cent often travel within the country. 5 per cent of respondents do not travel because the cost of rest does not comply with the quality of services, high accommodation and transportation costs, and also because they do not find it interesting to travel in Kazakhstan.
Businesses in anticipation
Rinat Khamidulin believes that individual and family tours, as well as compact group trips will be very popular during the coronavirus period because of fear of getting ill. Large group trips will certainly be left out and bus owners will incur losses. Tour operators will be increasingly working with customers online.
To the question of whether businesses are ready for restructuring he said that the south of Kazakhstan can organize almost all types of tourism. But there are problems with certification of guides, attendants and instructors. The law on the activities of tour operators and travel agents working in the domestic market is unclear.
“For example, the question of licensing of such legal entities. As far as I know, almost all operators working in this sphere do not have a license,” Khamidulin said.
He cares about the future of such small players: they can be subjugated to the companies with savings and assets that used to work in the outbound tourism sphere emerging in the domestic tourism market. He cares of the current situation most of all. In June, the market started to revive gradually, and first requests and offers were received.
However, the businessman fears another pause in the travel industry amid possible second wave of coronavirus. By the way, this course of events is possible. From July 5, Kazakhstan again declares lockdown –restriction on movement on the streets, beauty salons, gyms, markets, beaches and cultural facilities, entertainment shopping malls, etc. Bus services between regions was suspended, only air flights remained.
“The state bodies still did not provide clear explanations about this situation and any forecasts. All players act at their own risk. We hope the situation stabilises by August. However, we don’t know if people will have money and desire to travel. No one is going to make their product cheaper and bear losses,” Khamidulin said.
This article was prepared as part of the Giving Voice, Driving Change – from the Borderland to the Steppes Project.