FOR TOURISTS planning a hotel stay in Panama, it’s the best of times, but for hoteliers it’s the worst as an excess of rooms has generated a crisis in the hotel industry with some rates down by as much as 70% to attract guests.
Sara Pardo, president of the Hotel Association of Panama (Apatel) told Panama America that in some five star hotels, which previously cost $200 a night, have lowered the price to $60.
Alberto Quiroz, former president of the Network of Chambers of Tourism of Panama, has described the actions as a "price war".
Hotels have panicked and are desperate, said Quiroz, who said that the problem started many years ago, "when investors saw an opportunity, but many of them did not know about tourism and did no viability studies".
The new administrator of the Panama Tourism Authority (ATP), Gustavo Him, said that "unfortunately, that's the worst that can happen, but private enterprise has the right of free supply and demand."
Records of the Comptroller General show that hotel occupancy during the first five months of 2015 was 55%, down from 58% in the same period last year, but hoteliers dispute the figures claiming that occupancy in the city is down to 40% and in the interior 30%
Him said that "the only way to solve the problems of tourism in Panama is working with all the interested parts; we are open to the recommendations provided by the interested parties, from the interior to the capital".
But people in the tourism industry have reiterated that what is needed is more promotion, specifically branding the country , an area in which, they say, the authorities have been poor.
According to Quiroz there is a need to verify the exact number of tourists entering the country, as there are a lot of Venezuelans and Colombians who come as tourists several times but are "disguised residents" who stay for a few months.
With over 18,000 rooms nationwide, are added the clandestine lodgings, with people illegally renting apartments for short term stays.
Quiroz sees the pirate rentals establishments as "an additional oversupply to the legally established hotels".
This week the ATP fined four companies involved in rental activity without permission.
Meanwhile the construction of new hotels continue with a 300 room Ritz Carlton being built on Via 50 and another hotel on the corner facing Paitilla Hospital