The Covid-19 pandemic has affected all parts of the global economy, albeit in different ways. For tourism, it has been nothing short of catastrophic.
This is, or should be, of utmost concern to all policymakers. Tourism is one of the world’s largest markets, supporting one in ten jobs globally. After fuels and chemicals, it is the largest export category, accounting for 7% of global trade in 2019, according to the UN World Tourism Organisation (UNWTO).
It is no surprise, therefore, that the fallout of the pandemic has been huge. As many as 100 million direct tourism jobs are at risk, in addition to sectors associated with tourism such as the labour-intensive accommodation and food services industries, said a UNWTO report in late August.
However, a more recent appraisal from the World Travel and Tourism Council (WTTC) – the largest private sector body representing the tourism industry – paints a darker picture.
“Right now, 121 million direct jobs have been lost,” says WTTC president and CEO Gloria Guevara. “Unfortunately, after what we faced during the summer, we are heading for the worst-case scenario, which is 197 million jobs lost by the end of the year.”
Meanwhile, in terms of international visitors’ spending, the pandemic will wipe out between $900bn and $1.2trn in export revenues in 2020, according to the UNWTO. Small businesses, which make up 80% of the global tourism industry, are particularly vulnerable to the impact of the pandemic, and it is women – who comprise 54% of the tourism workforce – youth and workers in the informal economy who are among the most at-risk categories.
Countries across the world have undertaken numerous emergency measures to support their economies, and with some success.
Indeed, Julián Guerrero Orozco, Colombia’s Vice-Minister of Tourism, praises the way in which many countries have adopted policies such as unemployment subsidies and the easing of fiscal or tax obligations (such as VAT), but also lines of credit with preferential rates.
With regards to unemployment in tourism, some countries – such as France – have created centralised job platforms to connect out-of-work staff with companies that are actively hiring, particularly those outside the tourism sector.
However, many of these policies are being wound down, and as governments become increasingly torn between the needs of the public and the national economy, the efficacy of travel quarantines is coming under evermore scrutiny.
Data from around the world suggests that most Covid transmissions are community-to-community, not imported cases, according to Guevara.
“It is often only several parts of an entire country that sees increased cases,” she adds. “So, we are not in favour of blanket quarantines. It is a huge and [more often than not] unnecessary disincentive to travel.”
Nonetheless, international travel and tourism could be made safer. What is needed are international testing protocols that all countries work towards, says Guevara.
She suggests a rapid test for passengers at airport departure that is recognised by all destinations. Of course, those who test positive do not board.
“This, combined with wearing a mask and using sanitiser, means a very low risk of infection, according to the experts,” adds Guevara. “There will always be a risk – as with going to the supermarket – so we must accept a reasonable amount of it.”
In an effort to improve global coordination in the travel sector’s response to the pandemic, the WTTC launched the world’s first-ever global safety and hygiene stamp. The Safe Travels stamp initiative, which has now been picked up by more than 100 countries worldwide, allows travellers to identify destinations and businesses around the world that have adopted these global standardised health protocols.
The Safe Travels stamp is based on advice from the World Health Organisation, Centers for Disease Control and Prevention, and other authorities, but also from China’s first-mover example and the sector’s experience of the pandemic when it was at its worst.
Indeed, across many parts of the world, hotels and tourism businesses offered free rooms to the doctors and nurses in April and May, during the most virulent phase of the outbreak. In this period, the industry implemented hygiene protocols and, generally, succeeded in keeping spaces Covid-19 free.
Nonetheless, demand for international travel still remains low, globally.
“The key word of recovery is trust,” says Orozco. “We need to build it among travellers so that consumers want tourism products, because we are in a situation where travel is legal in most places.
“Global coordination of travel safety protocols is the key challenge,” he adds. “Governments need to come together, and not just regionally.”
Companies may need to come together too. A recent report from the WTTC found that 70% of North American leisure travellers said they would book journeys during Covid-19 if flight changes were fee-free.
Protecting the vulnerable
The impact of Covid-19 has been particularly brutal to the countries most dependent on tourism.
For example, the industry accounts for 91% of Macau’s GDP, 73% of Aruba’s, and 43% of the Bahamas’, which is why the pandemic has brought such economic devastation. Indeed, in the Caribbean alone, two million tourism jobs have been lost, according to the WTTC.
Almost one-quarter of all announced construction activity in the Bahamas was tourism- related between 2009 and 2020, according to GlobalData.
In terms of world regions, Asia’s tourism economies stand to suffer the most, according to Investment Monitor‘s Tourism Vulnerability Index, which examined data across three main pillars – GDP, employment and construction projects from GlobalData’s Construction Intelligence Centre. Indeed, in a ranking of the top 40 countries most heavily affected by the collapse in tourism, 15 are located in Asia.
“If developed countries are struggling right now, vulnerable economies are dying,” says Guevara. “They are asking for more international loans, and this is only decreasing their credit rating. This needs to be reworked.
“If we don’t do more to help less developed countries, we are going to see more illegal immigration, more poverty, more inequality,” she adds.
To the large degree, however, the most effective solution to these problems lies in the resumption of international long-haul travel. The Caribbean, for example, relies heavily on US and UK tourists, who are now only trickling back due to weak demand.
“If we can establish a corridor between London and New York that does testing on departure and contact tracing, etc, then the rest will follow with corridors to Asia, the Caribbean and Africa,” says Guevara.
Egypt is an interesting case study. Although the country is not overly dependent on its tourism market, the sector remains huge. In an effort to stimulate international tourism, the Egyptian authorities staggered the reopening of their most popular tourist destinations, thereby creating concentrated areas of hygiene. Egypt has also initiated a concerted social media strategy.
“Our extensive digital campaign entitled ‘Same Great Feelings’ promises visitors that hotels and touristic establishments are adhering to all required health and safety guidelines, without compromising on their experience,” says Egypt’s minister of tourism and antiquities, Dr Khaled El-Enany. “After a matter of weeks, global viewership has already exceeded 50 million on YouTube.”
Like Colombia, Egypt has also made significant efforts to encourage domestic tourism, which is helping the country in its nascent recovery. China has already recovered 85% of domestic tourism, which is one of the reasons the country is likely to be one of 2020’s only growth stories, according to the WTTC.
Adapting to new demands quickly is also crucial. Lockdowns around the world have heralded the rebirth of the great outdoors, so to speak. For example, as many as 40% of US travellers are rethinking destinations, often in favour of beaches, small towns and rural areas, according to a recent report from the WTTC.
Orozco says: “We are seeing internationally that people are looking for travel experiences that require smaller crowds: nature travel, adventure travel, rural or agro tourism. Colombia offers all of these and we intend to capitalise on that.”
Although countries can adapt to new consumer demands, the fact remains that the coming months will make or break thousands of tourism businesses. Much hinges upon how the pandemic evolves over the winter period, the weakest financial season for tourism. If governments do undertake another ‘hard’ lockdown, they must also be prepared to properly support hundreds to millions of job losses in tourism and beyond.