Swiss tourism benefits from weak franc

Tourists are enjoying all that Switzerland has to offer Keystone

Local tourist resorts are reaping the benefits of a weak Swiss currency that recently plunged to record lows against the euro and is also down against the British pound.

This content was published on July 12, 2007 minutes

The Swiss Travel Centre (STC), that manages bookings for the industry, reports surging numbers of tourists holidaying in Switzerland while European bookings are apparently unaffected.

Swiss tourists taking their breaks in European Union countries have been counting the cost ever since the euro climbed to a record high of 1.66 against the Swiss franc last month – an increase of some 6.8 per cent since last year.

It has also been difficult to stretch the franc during visits to Britain where the pound has strengthened in recent months.

Bookings in Switzerland are up 20 per cent this summer, a figure STC chief executive Klaus Oegerli attributes mainly to the cost of holidaying in the euro-zone.

"The European Union is getting more expensive for the Swiss and Switzerland is getting cheaper for foreign tourists which is having a positive effect both ways on bookings," Oegerli told swissinfo.

The increase in holidaymakers is split evenly among foreigners and the Swiss.

"In the past two years there has been a difference of about 15 per cent on the [Swiss franc-euro] exchange rate which does not account for the entire effect, but it certainly stimulates traffic," Oegerli said.

"The weak franc is not the ultimate decision on whether a Swiss person chooses to holiday in their own country or goes abroad, but it can influence one side or the other."

A recent report from Zurich University's Swiss Economic Institute predicted a one to two per cent increase in overnight stays in Switzerland for every one per cent the franc weakens against the euro.

Europe still strong

But the boom for tourism in Switzerland will not necessarily lead to fewer people going to Europe. Swiss travel operator Kuoni does not expect people to stop taking holidays in the favourite destinations of Greece, Italy and Spain just because their francs do not go as far.

Spokesman Peter Brun told swissinfo that there has been no impact on this summer's packages as customers booked them last autumn when the euro was lower.

He added that he expects the cost of holidays to increase by only between two to four per cent next summer as clients pay for flights in Swiss francs which limits the negative effect of exchange rates.

"We expect the exchange rate this autumn to remain about the same as now. People just love to go to the Mediterranean. A small price increase of SFr20 to SFr40 per person is not enough to make them change their habits," he said.

"People are price sensitive but they also look for quality. Also, the economic situation is going well so people have a bit more money in their pocket to spend."

swissinfo, Matthew Allen

Key facts

Overnight stays in Switzerland were up 5.8% to 34.8 million in 2006 compared with the previous year, according to official figures released in February.
Graubünden, Zurich, Valais, the Bernese Oberland and central Switzerland were host to almost two-thirds (62%) of all overnight stays – more than 3.5 million for each region.
The city of Zurich saw 2.4 million overnight stays, Geneva 1.8 million, Zermatt 1.2 million, Lucerne 860,000 and Basel 720,000.

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