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Jordan prices entice Israeli vacationers

High prices in Israeli hotels might drive locals to prefer trips to Jordan or Egypt as international travel cautiously resumes.

Meetings of Israel's coronavirus cabinet yesterday and today indicate the authorities fear another wave of infection. Still, as of this afternoon, no additional major restrictions have been approved on gatherings or transportation. Hotels in Israel remain open and Israelis are free to go on vacation and travel. However, vacationing abroad has become difficult, with several countries recently added to Israel's red list of forbidden destinations.

Israelis like to vacation abroad. In 2018, before the COVID-19 crisis, the number of Israelis doing so was no less than 8.5 million (Israel’s population is 9.5 million). Still, with travel restrictions in place elsewhere, many Israelis are expected to forego travel and spend their summer breaks, which began last week, close to home.

COVID-19 eliminated viturally all trips abroad in the past year. Israelis who wish to vacation outside of the country had hoped to finally be able to do so this year, but those hopes have dimmed. The coronavirus situation in Israel is relatively good because of its vigorous vaccination drive and countries like Greece, which Israelis love to visit, have opened their doors to vaccinated Israelis and don’t require tests upon entry or impose any other restrictions. But many other countries still forbid international tourism or impose many restrictions. Israel itself has blacklisted countries with high rates of infection. 

Public pressure has led to the opening of border crossings to two neighboring countries, Egypt and Jordan, popular destinations for their proximity, the beaches of Sinai and Aqaba and cheap prices. The Yitzhak Rabin border crossing reopened July 4, reconnecting Israel's resort destination Eliat with Jordan's Aqaba. Vaccinated Israelis won’t have to be tested for COVID-19, but unvaccinated people including those who recovered from past infections will have to get tested before arrival. Whoever spends longer than 72 hours in Jordan will have to show a negative test from Aqaba and will have to get tested again upon crossing the border back home.

A similar exemption from testing was granted by the Egyptian authorities to those who cross at Taba, which connects Eilat to the Sinai Peninsula, one of the most beloved vacation destinations for Israelis.

In Israel, there has been sharp criticism of hotels for raising their prices in light of increased demand and limited competition. Israeli Tourism Minister Yoel Razvozov angrily canceled a campaign to encourage internal tourism over the price gouging. Razvozov said in an announcement, “I don’t see a reason to continue the campaign while the prices of vacations are so high — it’s a pity to waste public funds on this. Vacations are not just for the rich.” The minister pledged to “act urgently” to mitigate the situation. 

In response to Razvozov's announcement, dozens of hotels announced lower prices, but prices in most hotels generally remain high.

The alternatives now reopening will especially interest Israelis. Aqaba is a favorite destination for Israelis, particularly divers, offers a much cheaper alternative to a vacation in Eilat. A price check on shows that a three-night vacation for a couple on July 7-10, including breakfast, would cost 2,100 shekels ($640) at the Hyatt Regency in Aqaba, 2,000 shekels ($610) at the Movenpick Hotel and 1,500 shekels ($460) at the Intercontinental. A similar vacation in Egypt's Taba would cost even less. A similar vacation in Eilat would cost 4,250 shekels ($1,300), including breakfast, at the Soleil Hotel, 4,400 shekels ($1,340) for three nights at the Pegasus Hotel, 4,900 shekels ($1,500) for an all-inclusive stay at the Isrotel Laguna and 8,300 shekels ($2,500) for three nights at at Club Hotel, four times the price of the most expensive hotel in Aqaba. 

Travel companies have started to sell vacation packages to Aqaba, and the prices compared to those for Eilat are truly laughable. The airline and vacation company Arkia is selling packages including flights and four nights at a hotel at 2,000 shekels ($610) for two — a third of the price of a similar hotel in Eilat with no flight.

Israeli hotel owners who have experienced heavy losses for more than a year because of the pandemic restrictions have raised prices trying to cover them. The president of Israel's hotel association, Amir Hayek, said that the cost of living in Israel is a burden to businesses, including hotels. He also complained about a shortage of workers.

The staffing shortage is due in large part to virus-related unemployment and paid leave policies that allowed low-wage workers to stay home. Finance Minister Avigdor Liberman explained, “There’s a serious shortage of workers and there’s no reason people should receive unemployment and not go to work. There are 130,000 jobs that can’t be filled.” 

When Israel reopened its economy after its mass vaccination campaign, hotel managers in Eilat asked the government to permit Jordanian workers to return. The government agreed for a certain number of them to receive special entry and work permits, but the hotel industry in Eilat feels much more is needed. Without the Jordanian workers they depend on, Eilat hotels will have a hard time functioning.

These developments and recent spikes in infection elsewhere could work in favor of Israel's domestic tourism. Prime Minister Naftali Bennett’s June 22 call on Israelis to refrain from traveling outside of Israel will certainly contribute to demand for local accommodation.

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