Tourism budget cut by nearly half in 2011

By PAULO SILVESTRE [email protected]

Algarve tourism is facing an “unsustainable situation” following  news that the region’s Tourism Board will see its budget cut by nearly half.

As part of the Portuguese government’s austerity measures, the Ministry of Tourism has proposed not only a 20% cut in funds on the 2011 budget but also a further 20% “retroactive cut” on 2010’s tourism reserve funds.

A spokesman from the Ministry of Tourism said: “This measure has been brought in to tackle the economic crisis in Portugal. Similar cuts are required to be made by all organisations that benefit from state funding.”

But the move was slammed by the Algarve Tourism Board (ERTA) President Nuno Aires, who said that if the cuts were applied it would create an “unsustainable situation” for the region.

ERTA had recently announced the approval of a budget of around €9 million for 2011, which will have to be revised if the budget cut proposals go ahead.

In an interview on Expresso TV, Nuno Aires said: “We had indications to implement the budget in full.  This new measure will represent cuts in the region of €4 million.”

Nuno Aires, who is also president of the National Association of Regional Tourism Boards, also said that if the measure is implemented, many tourism entities across the country will be at risk of closing their doors.

According to him, cuts in the 2011 tourism budgets were expected but tourism entities were not prepared for the proposed “retroactive reduction” in the 2010 reserve funds.

“Cuts in the 2011 budget are normal in view of the economic crisis. However, our question is: why is the Government cutting 2010’s budget, which is fully implemented,” said the Algarve tourism chief, who added that the cuts would only allow them to meet their fixed expenses, such as “staff wages and little more”.

Nuno Aires’ main concern relates to the internal and external promotion of the Algarve. He said: “These cuts will threaten the region’s promotional activities. This is particularly detrimental to the Portuguese economy because the Algarve is the main holiday destination (and revenue generator) in the country.”

The regional tourism authorities have now called an urgent meeting with the Secretary of State for Tourism, Bernardo Trindade and the President of Turismo de Portugal, Luís Patrão, to discuss the situation.

Meanwhile, Elidérico Viegas, the president of the Algarve hotels and resorts association (AHETA), believes that the cuts announced in the ERTA budget show “a lack of knowledge of the region’s economic reality.”

He told the Algarve Resident: “Tourism is one of the most important sectors to tackle the greatest weakness of the Portuguese economy, which is foreign debt.

“In this perspective, cutting the funds that could contribute to the increase of exports and would help to pay the enormous debt of the country is a serious measure that will only make the situation worse.”

Elidérico Viegas predicts that these cuts will threaten this year’s Allgarve programme. “This will require ERTA to review costs and expenditure on entertainment and to revise its plans,” he said.

Do you have a view on this story? Please email Editor Inês Lopes at [email protected]