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Brexit could have a significant impact on hotel activity in Cyprus and Malta

Cyprus and Malta are heavily dependent on British tourists - a decline in their standard of living could have a significant impact on their tourism activity.

A Brexit without an amicable divorce agreement would have serious economic consequences for the country, according to a report published by the British government and the Bank of England. British GDP would lose nearly 10 points over 15 years and AP economists estimate that the annual standard of living would be reduced by £1,100 per capita. Finally, the British central bank added that the pound could fall by a quarter of its value against the dollar leading to the UK's worst recession since World War II.

With almost 120 million nights spent in tourist accommodations in the EU 28 outside their country, the British are one of the heavyweights of the tourism economy and in 2016 Great Britain ranked fourth largest source market in Europe.

If the British economy were to fail, hoteliers would be among the first to suffer a drop in the number of visitors from this source market, on which some destinations have become very dependent.

In Malta, for example, more than 2.8 million overnight stays were accounted for in 2016 by customers from the United Kingdom, well ahead of those from Italy and Germany. The flight connections between Malta airport and London Gatwick (1st), Manchester (7th) and London Heathrow (8th) airports are among the busiest and reflect the strong impact on the island's entire tourism value chain that a Brexit without a divorce agreement could have.

Cyprus recorded more than 5.3 million overnight stays from the United Kingdom in 2016, followed by almost 4.3 million overnight stays from Russia. With a more diversified customer mix and source countries outside the EU, including Switzerland and Norway in the top 10, the weight of the British market remains significant for the island. In addition to tourism, the United Kingdom also participates in the country's economy thanks to a military base on the island where more than 3,000 soldiers reside.

If the UK economy were to fail as a result of the Brexit, these destinations would be heavily impacted by the weight of British customers compared to those from other countries. In France, the United Kingdom is leads in terms of overnight stays (more than 11 million in 2016). According to the observatory of the Paris Ile-de-France Regional Tourist Committee, British customers had accounted more than 6.6 million overnight stays in 2017, or 7.1% of international customers' overnight stays in the Ile de France region.

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