Globe, Latin America, United Kingdom

The tourism industry, on a knife edge

Tourist demand will take a maximum of five years to recover. Tourist arrivals could fall globally by 50% in 2020, due to the Covid-19 corona virus, which will require “innovative solutions”. However, despite the circumstances, there are other optimistic outlooks.

 

Roberto F. Campos

 

The power of resilience in this economic sector seems to be prevailing and, despite a very difficult year, everything points to resolving the main problems and moving forward.

The World Tourism Organisation (UNWTO) has said that international arrivals fell 81% in July and 79% in August, the busiest months of the year, coinciding with the summer.

This data seems very close to being definitive at the close of 2020. The collapse up to August represents 700 million fewer arrivals in comparison to the same period in 2019, and this translates into a loss of $730,000 million in export revenue coming from international tourism.

This is a loss eight times higher than that experienced in 2009 during the global economic and financial crisis. All regions recorded important falls in arrivals, and in particular for the Americas where the decrease was 65%.

The close of the year, nevertheless, in the middle of tourist and border re-openings in some countries, brings new outbreaks of the pandemic, and as a result, new restrictions from governments.

Therefore, the travel industry finishes 2020 faced with the dilemma of creating mechanisms that today may be appropriate for a recovery or perishing due to outbreaks of the illness.

Economists, researchers and market operators agree that, even though the road ahead is very difficult, this is one of the sectors most capable of riding out the storm.

Some say that the recovery of the tourist sector is distant, but there are also more optimistic and inspiring versions. A group of experts from the World Tourism Organisation (UNWTO) recently updated their forecasts. The vast majority of the members of this committee hope that recovery will be a reality in 2021, especially in the third trimester (coinciding with summer in the northern hemisphere).

Nevertheless, 20% of experts suggest that an upturn will not arrive until 2022.

Travel restrictions are considered to be the main barrier to the recovery of global tourism, along with the slowness in containing the new corona virus.

The lack of a coordinated response among countries to guarantee harmonised protocols, such as the deterioration of the economic environment are key factors, in addition to other aspects identified as important obstacles for recovery.

Furthermore, experts consider the need for at least two to four years in order to return to 2019 tourist levels.

The UNWTO Secretary-General, Zurab Pololikashvili, indicated that this unprecedented decline has dramatic social and economic consequences. He confirmed that such problems put millions of jobs and businesses at risk.

His warning also encompasses the need to safely return to tourism, at the opportune moment and in a coordinated way.

For example, after the gradual reopening of international borders, Europe recorded comparatively lower declines in July and August (-72% and -69% respectively).

The recovery, nevertheless, lasted a short time, as the recommendations and travel restrictions soon returned, in the middle of the increase in Covid-19 infections.

At the other end of the spectrum, the Asia Pacific region recorded the greatest drop, with 96% in both months, as a reflection of border closures in China and other important destinations in the region.

Travel demand continues in great measure to be repressed by the constant uncertainty over the pandemic and lack of confidence. According to the most recent trends, the UNWTO forecast a global drop close to 70% as 2020 finishes.

On this matter, the most recent report from the World Travel Market (WTM) fair estimated that tourist arrivals could fall globally to 50% at the close of 2020.

The WTM (headquartered in London) considers the Covid-19 pandemic to be the main cause of the decrease.

This study was created by researcher, Caroline Bremner, for the market analysis company, Euromonitor International, who indicates that in the worst of the analysed scenarios, the arrival of tourists would decrease by 60% this year, meanwhile the most optimistic would reduce by 50%. The most favourable scenario depends on fewer restrictions by governments and a vaccine against Covid-19 in 2021.

Bremner also suggests that the tourist demand with respect to the number of trips and value will last a maximum of five years to recover to their levels from before the health crisis. (PL)

(Translated by Donna Davison – Email: donna_davison@hotmail.com) – Fotos: Pixabay

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