Saturday, August 03, 2013

The Chamber Of Common Sense: Holiday rentals

The Chamber of Commerce in Mallorca and the Balearics is a body which deserves to have greater prominence and which deserves to be listened to rather more closely than it perhaps is. This is an organisation which in the past has produced one of the most informative and insightful reports into tourism (which it did in 2003) and an organisation which drew into serious question government estimates for passenger use on the eastern-coast Manacor to Artà railway. While it wasn't against the railway, it addressed the pure business case and found it wanting. Amid all the arguments over finance having been withdrawn for the railway and over its abandonment, nowhere have these arguments ever referred to what was an independent report which, had it been given proper attention, would have questioned the wisdom of ever proceeding with it.

The Chamber cannot be totally independent in that it does have business interests to consider, but it is a very much more independent body than the government or some of the business associations which represent specific sectors. It also tends to ally itself with a group known as the Economy Circle, one comprising leading businesspeople and which boasts as its various member companies banks, consultants, retailers, wine traders and even the odd hotel chain.

The Chamber of Commerce and the Economy Circle are unusual in Mallorcan business in being voices of sense, and the latest example of this sense has come from the Chamber of Commerce. It has to do with the rental of private apartments as tourist accommodation. Its president has written to tourism minister Carlos Delgado and outlined the serious harm that the demonising of private apartment rental will have and is already beginning to have. He sees the impact that the witch-hunt against holiday rentals will have. It is an impact that should be transparently obvious, but it appears not to be, to the government at any rate.

The Chamber's president points out that tourists may opt to go elsewhere, such as to Catalonia. Why Catalonia? Isn't there a crackdown on private apartments there as well? If you believe some media reporting, then there is, but this is a misunderstanding. Catalonia has a tourist tax, and the government there wants to properly register accommodation in order that it can apply the tax. Far from cracking down, Catalonia is in fact opening up. It is a region where there is an appreciation as to revenues that can be derived, which is the opposite to the Balearics, where a toothless government, controlled by the hotel industry, acts in a vindictive and myopic fashion.

What is interesting about the Chamber of Commerce's intervention is that it establishes that, other than disgruntled property owners, there is in fact a whole range of business interests opposed to the rules on holiday rentals. These include the powerful supermarket lobby, already at loggerheads with the government over its green taxes. For the first time, one senses that a genuine opposition is being mounted to the government over tourist apartments, an opposition which isn't that of what might be perceived as tax-fiddling owners but of those who are capable of impressing upon the government an economic and business case for adopting a different posture.

To the Chamber of Commerce can be added certain mayors who are only too aware of the potential damage that might be caused to their own local economies were there to be a withdrawal from the market of much accommodation or a decision made by tourists to head to alternative destinations within Spain that take a different view to that of the Balearic Government. There is, one feels, a groundswell of opposition that the government will find hard to fob off.

One can probably expect, as a result of the Chamber's intervention, that the hoteliers will go into propaganda mode, lamenting occupancy figures (which will not be anything like as bad as they make out) and decrying the lack of standards, the unfair competition and the tax fraud that the private accommodation sector, in their view, represents. They will do so, because this is what they habitually do. But even if they do not, for the government to ignore what powerful sectors of Mallorca's business are saying and to so ignore the Chamber of Commerce will only serve to emphasise what is widely understood to be the case - that the government acts firstly and almost exclusively in favour of the hoteliers. The government will, therefore, be exposed as not having the full interests of the tourism industry or of the Mallorcan economy at heart.

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