Tourist arrivals from Britain and Germany, Greece's top two tourist markets, are expected to fall by as much as 17 percent this holiday season, figures from two market research firms showed on Friday. A main pillar of the Greek economy, tourism employs about one in five people and is estimated at about one-fifth of the economy.

According to Reuters, this season it will be key for GDP growth in the Mediterranean country, which is already suffering the impact of the global downturn amid widespread social unrest. With the German and British economies wrestling with recession and rising unemployment, Greece's sunny islands will attract 10 percent fewer Germans and 17 percent fewer Britons this years, according to British-based Ascent-MI and GfK research group.

"It is clear that everyone will be hurt by the crisis," Gerasimos Fokas, chairman of Greek Chamber of Hotels, said at a tourism conference. "I am afraid 50,000 jobs will be lost."

Greece's once booming economy is expected to grind to a near halt in 2009. The head of the Greek statistics office told Reuters in an interview recently the size of the decline will hinge largely on tourism. About 15 percent of Greece's tourists arrived from the United Kingdom in 2007, according to HATTA, the Hellenic Association of Tourist and Travel Agencies, while Germans made up 13 percent.

"At this time last year Greece had a 15.5 percent share of the total market of UK holidays. It is now down to 14.6 percent," said Sarah Smalley, chief executive at Ascent-MI, a company providing data on the UK outbound holiday market.

Ascent-MI collects bookings from Thomas Cook (TCG.L: Quote, Profile, Research), TUI Travel (TT.L: Quote, Profile, Research) and 55 percent of all UK agents belonging to the ABTA travel association. Greece's 17 percent drop is worse than a 12 percent fall for the overall market, Smalley said.

Similarly, with total holiday bookings from Germany down 5 percent in the May-October period compared with 2008, Greece is seeing bookings down by 10 percent, said Alexandra Mundt, senior marketing consultant at GfK Retail and Technology in Nuremberg.

Greece is the top-third destination for Germans, after Spain and Turkey. Though Greece is not the only Mediterranean country to feel the brunt of the global crisis on its tourism industry, neighbouring Turkey is instead bucking the trend with solid growth this year, Ascent-MI and GfK figures showed.