Turkey raises charter subsidy to bolster ailing tourism sector

Turkey has increased a subsidy it pays to the operators of charter flights bringing foreign tourists into the country in an attempt to bolster visitor numbers which have fallen sharply due to a series of bomb attacks and tensions with Russia.

Tourist arrivals saw the biggest drop in 17 years in April, while average hotel occupancy rates are down nearly 70 per cent nationally, according to industry data, a hard hit for an economy reliant on tourism to fund its current account deficit.

The government is offering a 30 per cent increase on the $6,000 subsidy for charter flights carrying at least 150 passengers between June 1st and August 31st, the height of the summer season, according to an announcement in the Official Gazette.

Turkey's southern beaches are normally packed with tourists from Germany, Britain, other parts of Europe and Russia during the summer months.

But Russians have been told to stay away by Moscow after Turkey shot down a Russian jet near the border with Syria last year, while security fears are deterring Europeans.

On Tuesday a car bomb ripped through a police bus in central Istanbul during morning rush hour, killing 11 people and wounding 36 near the main tourist district, the fourth major bombing in Turkey’s biggest city this year. The attack was claimed by Kurdish militants.

Some economists have forecast that tourism revenue will drop by a quarter this year, costing around $8 billion, the equivalent of 1 per cent of GDP.