Bloomberg News

Italy Quakes Threaten Summer Tourism as Recession Bites

June 14, 2012

Italy’s strongest earthquakes in three years and more than 1,800 aftershocks are deterring tourists in the peak summer season, compounding a slowdown in the industry as Europe’s economy stagnates.

With 110 kilometers (68 miles) of coastline and pulsing resort towns like Rimini and Riccione, the quake-stricken region of Emilia-Romagna is one of the country’s top summer destinations, attracting almost 9 million tourists a year. Many of them, especially foreigners, have canceled trips following last month’s temblors, which killed at least 25 people, Alessandro Giorgetti, head of the Emilia-Romagna chapter of the Federalberghi hotel lobby, said in a phone interview.

“In light of the crisis and following the two quakes, I expect hotel revenue in the region to drop as much as 15 percent this month compared to last year,” said Giorgetti, who owns two of Emilia-Romagna’s 3,000 hotels. “I fear an even deeper slump,” he said.

With more than 76 million tourists a year, Italy is one of the most visited countries in the European Union. Tourism accounts for almost 10 percent of Italy’s gross domestic product and employs about 2.5 million people, according to research group Eurispes. Spending by foreign tourists rose 5.6 percent last year even amid the debt crisis, Bank of Italy data show.

Emilia-Romagna, which in addition to sandy beaches and throbbing nightlife is home to historical cities like Ravenna and the Ferrari auto museum in Maranello, generated tourism revenue of 11.3 billion euros ($14 billion) in 2011. The Adriatic coastline accounts for more than 80 percent of that figure, according to the region’s press office.

L’Aquila Disaster

The Emilia-Romagna quakes -- a 5.9-magnitude temblor on May 20 and a 5.8-magnitude one on May 29 -- were the strongest in the country since the April 6, 2009 earthquake in L’Aquila that killed more than 300 people. There have been 1,852 aftershocks since the May 20 temblor, including a 4.3-magnitude quake on June 12, according to the Italian Institute of Geophysics and Vulcanology.

Neither of the May quakes struck near the coast, with the epicenters some 100 kilometers away near Modena. Still, many sun-seeking foreign travelers were scared off, Giorgetti said.

“Some people think the Po valley has been split in two,” he said. “One German man called from Dortmund to ask if the Bologna airport had been destroyed.” The airport is operating normally and no flights have been canceled since the quakes hit, according to its press office.

Media Campaign

Italy’s Ministry of Tourism, Sports and Regional Affairs and the national tourism agency Enit have launched a media campaign focused on foreign markets, especially Germany and Russia, to reassure travelers that the region is safe.

The quakes, which employers’ lobby Confindustria estimates caused more than 4 billion euros in damage to the economy, came at a time when Italy’s consumer confidence fell to its lowest in more than 15 years and austerity measures have helped push the country into its fourth recession since 2001. Prime Minister Mario Monti’s government approved a 20 billion-euro austerity plan in December that included tax increases, crimping domestic demand.

Gas Prices

To help fund aid to the stricken region, Monti’s Cabinet approved an additional tax hike of 2 cents per liter of gasoline. That could further hurt tourism in the region, said Gianmario Ferrari, owner of three hotels in Rimini. With gas prices soaring, “can you imagine how much it costs for someone who lives up north to come down here,” he said.

Italy suffers about 2,000 earthquakes a year, with more than 3 million people living in seismic areas, according to the National Council of Geologists. Almost half of Italy’s territory is at risk of a quake, with more than 6 million buildings in seismic areas, the group said.

Many historical buildings and churches in Emilia-Romagna, including a 14th century castle in Ferrara, were damaged by the quakes, marking the greatest loss to Italy’s heritage since a 1997 temblor ravaged the Basilica of Saint Francis in Assisi.

Damage to Emilia-Romagna’s cultural heritage “is the real worry,” said Matteo Caroli, a professor at the Luiss Guido Carli University in Rome. Historical towns that used to attract travelers “may need new marketing.”

To contact the reporter on this story: Chiara Vasarri in Rome at cvasarri@bloomberg.net

To contact the editor responsible for this story: Jerrold Colten at jcolten@bloomberg.net


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