In the past decades, tourism has experienced continued growth and became one of the fastest growing economic sectors globally. The sector witnessed a 59% growth over the decade in international tourists’ arrivals from 1.5 billion 2019 compared to 880 million in 2009. Globally, the industry contributed to $8.9 trillion to the global GDP in 2019 equaling a contribution of 10.3%. However, the strong growth has been halted in 2020 amid the Covid-19 pandemic. With airplanes on the ground, hotels closed and travel restrictions implemented, travel and tourism became one of the most affected sectors since the very start of the virus spread. The pandemic has cut international tourist arrivals in the first quarter of 2020 to a fraction of what they were a year ago.
Closing borders, tourism & travel ban
Countries all over the world applied travel restrictions to limit the coronavirus spread. Airport closures, the suspension of flights, and nationwide lockdowns are just some of the measures that countries are implementing in an effort to contain the pandemic. After the spread of the pandemic in the first two quarters of 2020, at least 93% of the global population lived in countries with coronavirus-related travel restrictions, with approximately 3 billion people residing in countries enforcing complete border closures to foreigners.
The decline of International Tourists during the Pandemic
The number of international tourist arrivals has been growing remarkably in the last decade and still sustained growth throughout the last years; in 2017 arrivals reached a total of 1.3 billion globally, 2018 reaching 1.4 billion and 1.5 billion in 2019. In 2020, due to the severe impact of the COVID-19 Pandemic, international tourism went down by 65% in the first half of 2020 when compared with 2019 figures.In May 2020, the majority of the UNWTO (World Tourism Organization) tourism experts expect to see signs of recovery by the final quarter of 2020 but mostly in 2021.
Covid-19 and Airline Failures
The International Air Transport Association (IATA) financial outlook released in June showed that airlines globally are expected to lose $84.3 billion in the year of 2020 for a net profit margin of -20.1%. It also stated that revenues will fall by 50% to $419 billion from $838 billion in 2019. In 2021, losses are expected to be cut to $15.8 billion as revenues rise to $598 billion. IATA’s Director General and CEO, stated that “Financially, 2020 will go down as the worst year in the history of aviation. On average, every day of this year will add $230 million to industry losses. In total that’s a loss of $84.3 billion”. What’s shocking is witnessing how many airlines have failed during the coronavirus pandemic. And even for airlines that are still in business, the situation is severely difficult. The second-largest carrier in South America, Avianca Holdings survived the Great Depression – but not coronavirus. The airline filed for Chapter 11 bankruptcy protection in May.
Hospitality Sector Hit by the Lockdown
The lockdown due to the pandemic has affected the tourism industry across the globe, and the hotel sector is among the hardest hit. Global hospitality data company STR compared 2020’s first quarter status to 2019 figures, hotel occupancy rates dropped as much as 96% in Italy, 68% in China, 67% in UK, 59% in US. There’s no doubt that the hotel industry has witnessed a severe impact by the pandemic and the lockdown status.
Balancing the Return of Tourism Revenues and Safety
As of July 2020, the EU opened borders to tourists from 15 different countries leaving the U.S. off the list. Health officials developed a plan to classify accepted countries based on how the country is performing in controlling the coronavirus. A country is considered under control when they have a number close to or below the EU average for new coronavirus cases over the last 14 days and per 100,000 inhabitants. On 15 June, the European Commission launched ‘Re-open EU’, a web platform that contains essential information allowing a safe relaunch of free movement and tourism across Europe. The platform will provide real-time information on borders, available means of transport, travel restrictions, public health, and safety measures.
The Return of Tourism Globally
With lockdowns ending around the world, many countries have started to ease border restrictions and reopen for international tourists. Although many governments are still advising against “nonessential” international travel, a host of popular destinations have eased their Covid-19 border restrictions and are readily welcoming tourists back:
– The European Commission has released guidelines for how its Member States can start to ease coronavirus travel restrictions and enable tourism to begin again
– Destinations like Dubai, the Maldives, Egypt, Lebanon, Croatia, Kenya, Tanzania and Jamaica have already opened their doors to foreign visitors again, while Thailand hope to reopen soon
While tourism is slowly returning in some destinations, most members of the UNWTO Panel of Tourism Experts expect international tourism to recover only by the second half of 2021, followed by those who expect a rebound in the first part of next year.
However, there are still concerns over the lack of reliable information and deteriorating economic environment which are indicated as factors weighing on consumer confidence, especially with the potential new limits on travel as world comes to grips with second Covid-19 wave. The concerns over the waves of coronavirus brought on by returning vacationers are wreaking havoc on the world’s tourism industry.