ISTANBUL — The once bustling Grand Bazaar in Istanbul is astonishingly quiet. The shops and restaurants in the city’s trendy Istiklal Street are all but empty of foreign customers and the hotels in the upscale Nisantasi district are nearly deserted.
Turkey’s economy is suffering in the face of a string of extremist attacks — including the nightclub massacre of New Year’s revelers, most of them foreigners — and uncertainty following the failed coup in July against President Recep Tayyip Erdogan that saw more than 270 people killed.
Tourism, a key component of the economy as well as a substantial foreign currency earner, has taken a hit — not least because Russian visitors have stayed away in the wake of a diplomatic spat over Turkey’s downing of a Russian warplane in November 2015.
“2016 was a lost year for Turkish tourism,” said Cetin Gurcun, secretary general of Turkey’s travel agency association, TURSAB.
“It is impossible for Turkey to give up on tourism, but the most important priority of the sector is security,” Gurcun added. “The first thing a tourist looks for when choosing a destination is peace and safety. Only then do they research service quality and price.”
There was a time when tourism in Turkey was red hot, climbing from 10.5 million visitors in 2000 to 36.2 million people in 2015, making it the sixth-most visited destination in the world. The sector earned $31.5 billion in 2015. But that all came to a halt last year, with a 30 percent drop in visitors, from 34.8 million in the January-November period in 2015 to a little over 24 million for the same period in 2016.
Yasemin Pirinccioglu, general manager of the VIP Event travel agency, said that foreigners who had visited before were still returning. “But the people who are planning to come for the first time to Turkey, they’re postponing their trips,” she said.
Natalia Dubaltsava from war-ravaged eastern Ukraine is among those who come to Istanbul regularly.
“We make trips here anyway,” she said. “There is unrest in the world. It’s a fact. People say the same about our city, Dnepropetrovsk. We are close to the front line, but it is calm there. Life is life. We decided to go anyway.”
Because of the economic downturn, the Turkish Lira hit a record low in the first week of 2017, trading around 3.60 per U.S. dollar. Analysts expect it to weaken further in coming months.
While the weaker currency could have some beneficial economic effects — making it cheaper to visit or invest in Turkey and helping the country’s exports — the drop makes the country poorer overall and less able to pay its debts.
The security concerns are obvious in the economic data. In the third quarter of last year, the drop in tourism was the main cause for a 7 percent year-on-year decrease in the sale of goods and services. Consumer spending and investment have also plummeted since the summer.
Istanbul, the country’s most popular tourist destination for foreigners, has been the biggest target for extremists.
Ten German tourists were killed in a suicide attack in the heart of Istanbul’s historic district on January 12, 2016. Other attacks in Istanbul include one in the central Beyoglu neighborhood in March, as well as at the city’s main airport in June, where dozens died.
Hundreds of people eager to wave goodbye to a tumultuous 2016 gathered at the popular Reina nightclub in Istanbul for New Year’s celebrations only to become the first victims of 2017 when an Islamic State gunman stormed the premises and killed 39 people, mostly foreigners.
One statistic stood out in the wake of the tragedy — most of the victims were from the Middle East.
“Before, there were a lot of customers from America and Europe,” said the club co-owner, Mehmet Kocarslan said. “Once the Westerners decreased, Middle Easterners became a majority.”
“2016 was a very unfortunate year for Turkey,” added Kocarslan, who said he was contemplating closing the club after the massacre. “There hasn’t been a hardship our country didn’t encounter.”
In the sprawling Grand Bazaar — officially the first ever roofed shopping mall when it was built in the 15th century — vendors stood in front of their jewelry, clothing and souvenir shops, desperately looking for foreign customers.
“Business is quite different than before,” shop owner Muslim Besenk said. “There are bombs going off everywhere, why should tourists come? Only Arabs come. The rest cannot come and it’s not certain that they will.”
Basel Trablesei, a tourist from Lebanon, did not seem worried by the security in Istanbul despite the nightclub attack.
“What happened here happens anywhere in the world, so this is something we can’t avoid,” he said. “I tell everyone to come to Istanbul.”
Pinar Kartal Timer, general manager of Istanbul’s historic Pera Palas hotel in the lively Beyoglu neighborhood, said the rise in tourists from the Middle East was because of Turkey’s greater ties to the region.
“It’s because already the strategy of the Turkish government has been to make a rapprochement with Middle Eastern countries,” she said, referring to the conservative leadership that has shifted from its pro-Western policies.
Barcin Yinanc, a columnist at the English-language Daily News, said that all the strategic advantages Turkey offered in the mid-2000s have now turned against it.
“Ironically, all the triggers that helped Turkey fly high in the global market in the mid-2000s — safety, security, stability and predictability — have now become big barriers,” she wrote.