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Buoyant Turkish Tourism Wary of Slowdown Due to Iran, Coronavirus Worries

Passengers from China pass by a thermal screening point upon their arrival at Istanbul International Airport in Istanbul, Turkey, Jan. 24, 2020.
Passengers from China pass by a thermal screening point upon their arrival at Istanbul International Airport in Istanbul, Turkey, Jan. 24, 2020.

Turkish tourist arrivals surged in January but there are signs of a slowdown in the following months, a hotel association said on Monday, while the closure of Turkey's border with Iran stoked fears about the impact of the coronavirus.

The unease about the spread of the virus in Iran, a key source of tourists for Turkey, was illustrated on Monday as Turkish Airlines canceled flights to four Iranian cities.

Tourism is an important source of foreign currency for Turkey, helping to rein in the energy importing country's usually wide current account deficit, and data on the sector is closely watched.

On Monday, Tourism Ministry figures showed the number of foreign visitors arriving in Turkey surged 16.1% year-on-year in January to 1.79 million, with Iranians fourth on the list of countries with 6.7% of the market.

The sharp rise in January was in line with the trend last year, when Turkey's tourism revenues rose 17% to $34.5 billion, but the Hotel Association of Turkey (TUROB) voiced caution about the outlook.

"The TUROB assessment showed signs of a slow February and a slowdown in March, despite the rise in the first month of the year," TUROB said in a statement.

It said the hotel occupation rate in January had risen 6.4% from a year earlier to 61.9% but forecast a decline in both this rate and room prices in February and March.

On Sunday, Turkey's health minister said the country had closed its border with Iran and halted incoming flights as a precaution to stop the potential spread of coronavirus.

Tehran said 12 people have died and up to 61 have been infected by the virus in Iran.

There are usually large numbers of Iranians who visit Turkey in March and April due to Iranian New Year in late March, meaning that the length of the border closure could have a major impact on the tourism season, sector officials said.

Last year as a whole, some 2.1 million Iranian tourists visited Turkey.

Turkey has not recorded any cases of coronavirus but the large spike in Italian cases has especially rattled investors in Europe, concerned about the potential for the virus to spread further and cause economic disruption there.

Shares in Turkish Airlines fell 5.6% on Monday, while Pegasus Airlines dropped 4.9%, in line with a slide in airline shares elsewhere over coronavirus worries.

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