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The drastic increase in hotels and restaurants on the island was posing a risk to the sectors’ profitability, the author of a nationwide study warned on Friday. Conducted by ‘big four’ accounting firm Deloitte, the study found that while tourist arrivaProfitability of hotels, restaurants under threat
The drastic increase in hotels and restaurants on the island was posing a risk to the sectors’ profitability, the author of a nationwide study warned on Friday. Conducted by ‘big four’ accounting firm Deloitte, the study found that while tourist arrival trends were still positive, the increases were less pronounced than in previous years and the sector was now facing “a number of challenges”. “Results aren't what we got used to. We had a number of years when the graphs kept going up,” Raphael Aloisio, from Deloitte, said. Why was the sector facing a tougher reality today? While the study gives a variety of reasons, Mr Aloisio gave a blunt explanation of his own: if supply (of hotels and restaurants) continued to increase at a faster rate than the demand for rooms and tables, then the results would keep going down. The number of permits for hotels being issued had shot up from 15 in 2012 to 119 in 2017, he said, describing this as “alarming”. His warning prompted grunts from the hoteliers and restauranteurs gathered for the presentation and was quickly followed by a slight change of tone on Mr Aloisio’s part for industry players not to take any drastic decisions in reaction to... Read more