Record Swiss franc sends Swiss on holidays to Greece

Fri Jul 22, 2011 7:47am EDT
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By Caroline Copley

ZURICH (Reuters Life!) - Holidaymakers don't come happier than 39-year-old Swiss private banker Andreas Pletscher, who has just saved 2,000 euros ($2,840) on a two-week family holiday to Greece.

Wallets stuffed with the single currency, the Swiss are shunning Alpine resorts and flocking abroad. Sovereign debt woes in the euro zone have driven the safe-haven franc up some 6 percent against the single currency so far this year, after a rise of more than 15 percent in 2010.

"It's substantially cheaper. We've saved about a fifth," Pletscher said, smiling as he handed over his passport to check in for a flight to the Greek city of Patras. He plans to spend the extra cash on meals out and shopping.

Although the strong franc is a boon for tourists, it has prompted squeals from retailers and hoteliers, who see their profits disappearing into the tills of foreign competitors.

Exporters say they are close to breaching the pain threshold, and have lowered prices to keep orders afloat. Some companies are making staff work longer hours for the same wage, while others warn they may start paying employees in euros to control costs.

"The euro is hurting us more than the financial crisis," Guglielmo Brentel, head of the Swiss Hotel Association told the NZZ am Sonntag.

Since 2008, the cost of holidaying in Switzerland has risen by a fifth for tourists from the euro zone, while Britons can now reckon with prices that are 35 percent more expensive, consultancy BAK Basel said, forecasting a fall in overnight stays from foreign visitors of 2.6 percent this summer.

In some of the worst affected Alpine regions, hoteliers are trying to lure holidaymakers from the single currency bloc by quoting prices in euros at a conversion 20 percent below the current market rate.   Continued...

<p>A tourist walks in front of the Parthenon temple at the Acropolis hill in Athens, July 10, 2011. Picture taken July 10, 2011. REUTERS/John Kolesidis</p>