Majorca told not to put its prices up

PALMA
BRITISH travel industry chiefs yesterday urged the Balearic tourist industry to temporarily shelve any plans to put prices up while the Pound continues to drop to new lows in value against the Euro.

Yesterday, the Pound eventually recovered after hitting a new record low against the Euro in early trading, and the UK travel industry is worried that Euro-zone holiday sales, in particular to the most popular destinations such as the Balearics, mainland Spain and France, will suffer if the Pound's value against the Euro remains low or weakens even further.

Some travel industry sources claimed yesterday that a Euro-zone summer holiday is going to cost British families an extra 700 pounds and those families having to operate on a tight budget may decide to holiday at home as the cost of living in the UK continues to rise.

Therefore, in the meantime, destinations like the Balearics are being advised to freeze prices or face the threat of losing holiday makers to non-Euro zones.

For example, the Pound may be feeling the weight of the Euro, but it is holding up well against the Dollar and some British families which have not booked their summer break yet are expected to cut their losses and summer in the States instead of Europe's more traditional family holiday destinations.

Turkey and the emerging Eastern European destinations are expected to fair well as well as the Middle East and destinations such as Dubai, which is enjoying a British holiday and property boom.

The present currency climate is not particularly encouraging for pensioners considering moving to a Euro zone destination as they will lose out on their pensions.

Some travel industry sources maintain that the Pound will bounce back in the short term and that the negative effect on Euro-zone holiday sales will be minimal.

However, the City does not appear as optimistic with some sources claiming yesterday that the situation is “going to get worse before it improves.” On the flip side, Britain is braced for a sharp increase in the number of visitors from the Euro-zone.