GENOV: State Stimulus Package Not Sufficient for Hospitality Sector, Hotel Owners Exhausted, Hotels to be Sold

The state's measures for helping the economy are not sufficient for the hospitality sector and are only 40% applicable, the director of the Business Association of Hotel and Restaurant Industry of Serbia (HORES), Georgi Genov, says for eKapija. He adds that state help in paying minimum wages for at least 6 months to employees in hotels and restaurants could save jobs.

– We are looking into the measures and researching which measures could be effective, so that we could propose a new package, which would be relevant for us. No one is considering our sector in particular, as we are not a factory and we will not be able to start working on June 1, as there will be no guests – Genov said.

Hotels in Serbia, he points out, worked at a reduced capacity this winter, and the capacities on the Danube and spas are the most affected.

– Hotel owners are exhausted and are facing a collapse. We can no longer invest, take out loans, and hotels will need to be solved, as people will not be able to continue working – Genov says.

He points out that hotels in Belgrade are in big trouble, as they are oriented toward business tourism.

– Hotels in Belgrade for foreign tourists, business people, will certainly not work until October, at best. There will have a hard time trying to survive. They have no reserves – our interviewee says.

As he adds, debts toward public enterprises, especially EPS, are a problem as well.

– Hotels are paying high electricity prices even now when they're not working, amounting to EUR 20-30 thousand a month. This needs to be postponed – Genov believes.

According to him, local self-governments should help hotels too.

– The property tax is extremely high. Hotel and restaurant owners should be exempt from tax payment for these months when they are not operational, as there are a total of 42 fiscal and parafiscal charges in this sector – he points out.

An important measure would be to reduce the food VAT from 20% to 10%.

– We are in a difficult situation anyway, our salaries are EUR 310 on average, as the work is seasonal. Employees, but also employers, should be saved, because, if they can't start a business, there are no workers either – he says.

What to do after coronavirus?

As Genov says, after the crisis caused by coronavirus, tourism will have to rely on domestic guests.

– We will have to rely on domestic tourism, to have people spend their vacations in our facilities and to have school trips organized in Serbia.

According to the estimates he cites, there will be a drop in prices of 20-30% in the hospitality sector on a global level.

– Tourism will go back to its normal state in January 2021 only, as hotels will not be working for sure. It is cheaper for them not to work, and we can't store our services – Genov says.

He adds that HORES is already cooperating with the Tourism Organization of Serbia in finding ways to promote the sector when the pandemic ends.

Ivana Milovanovic

HORES Beograd

Turistička organizacija Srbije

Business Association of Hotel and Restaurant Industry of Serbia

HORES

Georgi Genov

hospitality

minimum wages

help to economy

coronavirus

reduction of food VAT

domestic tourism

school trips

salaries

hotel owners

business tourism

restaurant owners