Hoteliers Claim Investment Law Unfair

Following the recent amendment of the new investment incentives law, Greek hotel owners requested the withdrawal of two “unfavorable” provisions.

Hoteliers indicated that the specific provisions of the law significantly worsen investment conditions to modernize hotels and exclude investments of low category hotels (under four stars).

The first provision suggests to double the time period (from five to 10 years) that has to pass in order for a hotel unit to receive a subsidy and upgrade its infrastructure.

The Hellenic Hotels Federation pointed out that according to international standards, hotel infrastructure modernization is implemented every five years.

Therefore, any extension of the time limit will lead to the reduced competitiveness of Greek hotel infrastructure.

The federation underlined that the key objective of any development law is the improvement of the quality of hotel infrastructure so Greek tourism can cope successfully with the intense international competition.

The second provision sees the upgrading of only 4- and 5-star category hotel units.

According to the federation, such a change would lead to the creation of a two-speed hotel product, as it will become impossible to upgrade hotels up to three stars.

“Greece receives 16,000,000 foreign visitors and serves more than 4,000,000 Greeks per year and must offer high quality services for each category and for every budget,” the federation said.

The federation called for the immediate withdrawal of the two amendments as it said they would affect the balance of the hotel market as well as its development prospects.

The Hellenic Chamber of Hotels commented on this provision of the investment law and said that it aggravates the conditions of investments for the modernization of hotel units, while it prevents the backbone of the hotel industry (hotels less than 4 stars) to proceed with such investments.

“This provision excludes the upgrading of most middle and low class hotels at a time when the preservation of Greek tourism to a satisfactory level of quality is a must for its survival against the (present) crisis and its consequences,” said the chamber.

“The logic to convert all Greek hotels to 4- and 5-star hotels is completely contrary to the actual needs of the country’s tourism sector.”