Difficult 2008 Will Usher In A Few Lean Years… According to data from the Polish Institute of Tourism (Instytut Turystyki, Intur), there were 59.94mn visitor arrivals in 2008, of which 12.96mn were tourist arrivals, reflecting falls of 9% and 13%, respectively.

Performance during 2008 was negatively affected by the global economic crisis and, as global economic weakness looks set to continue in 2009 and 2010, we believe that it is wise to be cautious in our short term forecasts. We predict that arrival numbers will fall by 3% in 2009 before remaining flat in 2010.

Beyond this point there is scope for recovery, especially as Poland is co-hosting the 2012 UEFA European Football Championship with Ukraine.

…But Euro 2012 Will Support Long-Term Growth In 2012, Poland will co-host the 2012 European Football Championship with Ukraine. The tournament involves 16 teams and will therefore see visitors from at least 14 other European countries, with crowds for each match likely to range from 30,000 to more than 80,000 for more than 30 games. It is the first time that Poland is hosting a major football tournament. When Germany hosted the World Cup in 2006 it provided a moderate boost to the economy. Much of the positive boost for Poland will come in the shape of upgrades for accommodation and infrastructure links prior to the tournament.

However, while clearly a boost to Poland’s tourism sector, the effect on visitor arrivals should be kept in perspective. For example, when Greece hosted the Olympic Games in 2004 in Athens, it experienced a decline in overall tourist arrivals that year, as people who were not following the Olympics decided to holiday elsewhere.

Airlines: LOT Remain In Financial Difficulty Local media reports in May suggested that LOT Polish Airlines posted losses of PLN700mn in 2008.

The airline remains in severe financial difficulties, with the government unable to bail it out because of EU competition rules. Against this backdrop, a sale of LOT in the near future cannot be ruled out, although obviously the government would prefer to wait for the global economic uncertainty to end in order to get a higher price for any sale.

Hotels: Orbis Holding Steady Orbis Hotel Group is Poland’s largest hotel chain, majority owned by France’s Accor. Sales revenues for 2008 were essentially flat year-on-year (y-o-y). However, net profit fell by 67.6%, to PLN43.6mn, a result of the difficult operating environment for hospitality companies. Also, the company said that the 2007 net profit figure had been boosted by one-off property sales.