The Impact of COVID-19 on Tourism Industries Worldwide
We all are familiar with the fact that the travel and tourism industry makes up a big part of the world’s economic activity and also that due to restrictions on traveling how much this prospering industry has come to stand at the bottom. We all make plans to go to attractive places every year and while we think that it is for sole fun, it is indirectly benefiting a lot of daily wage workers and not only our traveling agent. Besides it provides local residents and of course many startups and mega travel and tourism companies with job handlings of a hotel manager, spa manager, event & conference organizer, executive chef, tour guide. Now this industry has almost doomed because of the unfortunate pandemic.
Source: World Travel and Tourism Council
We know that the impacts are deep and will leave scars that call for change in the travel industry, but how is it country and continent wise? We're going to look at the overall impact of the pandemic on these places and how they are affected.
The United States
The USA is the only country to gain much from the profits of travel and tourism which is a country also one of the worst-hit by this pandemic. The revenue generated from tourism in 2019 in the US was almost $210.7 billion which is even more than half of what is earned by Spain. As it became the major hotspot for COVID-19, all traveling facilities have been shut down for good. But this good decision is rather against the employees in the sector of travel and tourism.
The famous airlines American and United suffered a total loss of $2.24 billion and $1.7 billion respectively in the first quarter of this year and the people’s job is at stake if this industry doesn’t open after the month of October. Although the CEO of American Airlines gave hope that it can be avoided depending upon how fast the airline companies open up.
According to an article published by Forbes, “USA can face a loss of $910 billion due to shut down of the travel industry, which is seven times the loss due to the attack of 9/11.” The USA travel association which acts as a support system for travel agencies predicted that 4.6 million jobs could be lost in just this industry.
“The coronavirus crisis is hitting the travel economy hard, and it's also hitting fast,” said the association’s president and CEO Roger Dow in a statement. Tourism Economics found that one out of every ten citizens of the USA is associated with the travel job and if this situation prevails, the national unemployment rate is surely going to rise. But to combat the situation for now the association introduced CARE Act and funded travel organizations with relief packages.
Check out this blog on the impact of COVID-19 on tourism by India City Blog.
The collection of paradise lies here, in Europe. From westernmost Portugal to far east Ukraine, every country in Europe is worth a watch. That's the prime reason why countries like France, Spain, Italy, the United Kingdom, and Turkey remain top destinations among the list of every enthusiastic traveler. In 2018, about 713 million people visited Europe. Now due to the spread of the deadly coronavirus, no one is visiting these countries and we can only imagine the worsening of the situation. But many airline companies in Europe like EasyJet and Ryanair are looking forward to opening their airports in June for travelers because of the incurred losses and to compensate for it.
What is more significant here is the loss of the tourism industry of Europe. The circumstances are similar to World War II. Commissioner of Internal Market of European Union (EU), Thierry Breton said, "Tourism was the first sector to be hit by the coronavirus and I am sure that it will be the slowest to recover and come out of this phase". It is rather hard to imagine how the authorities of museums, beaches, parks, and restaurants would be dealing with this condition. Due to the shut down of these points, a loss of $300 to $435 billion is estimated, even as these countries slowly recover.
The tourism industry of the EU gains as much 550 billion euros every year which contributes to a major part of their GDP. The direct and indirect jobs that this industry provides to these states sums up to 26.6 million. It was one of the fastest-growing industries where investments used to be high. The part of Europe which is mostly going to be affected is Southern Europe as a major sector of economy dwelled upon this, like Greece where about 23.4% of the population worked under the tourism sector. The main blessing, in this case, was that the European states gained enough US dollars from foreign countries that exceeded the spending of the government on different aids like building up schools, hospitals, universities, etc. Now instead of spending on these necessities, all the government's funds are going into building better health infrastructure and saving it's peoples' lives, as it should.
Several steps have been taken by the EU to support the travel and tourism industry as they are in the hands of agony due to uncertain futures. Measures like liquidity support, fiscal relief, and an easing of state aid rules, as well as the temporary suspension of EU rules on airport slots to avoid empty flights, have been taken. On May 13, the EU passed out guidelines and recommendations on travel and transport to help the countries of the EU to resume their airline services to reopen travel and tourism businesses.
The Brussels and the EU state members have rolled out 200 billion euros spending programs which constitute 1.5% of their GDP to help the common people. We can do nothing but hope that these packages which are released by the European state governments now and then are enough to tackle the down-falling of the prestigious travel and tourism industry.
Slowly, the government is also looking into creating travel bubbles within Europe to enable European citizens to travel within the EU. If you're in Europe, look for smaller and unexplored destinations such as the quaint town of Trier in Germany, the oldest city of the country - check out this cool blog by Le Monde The Poetic Travels on the city of Trier and why you should visit it, especially when you want to travel and need smaller and less populated destinations.
Asia is full of majestic countries. Either we go from north to south or from east to west, the culture seems to diversify. From the mouth-watering Chinese, Thai or Japanese food to the fiery Indian dishes everything is globally trending. Asia remains a top tourism destination among many. But not from a few days back, when the traveling and tourism industry in Asia got struck by this awful disease.
Thailand which attracts around 34 million tourists around the year is expecting to see only 6 million visitors, that too if the spread of COVID-19 stops. This industry is extremely crucial for Thailand because it constitutes about 22% of the GDP of their country. Last year, approximately $62.5 billion came into this country because of travel and tourism and about $15.6 billion could be lost if the current scenario prevails as stated by the Tourism Authority of Thailand (TAT).
Another country that is struck hard due to the shut down of the travel and tourism industry is the Philippines. Most of the visits occur during summer and due to lockdown, they are sure to lose many tourists and the riches they bring. The Department of Tourism (DOT) which is based in the Philippines has measured a loss of $849 million if the situation doesn’t get back to normal. Tourism Secretary Bernadette Romulo-Puyat has said that DOT will soon promote tour packages and discounts on domestic flights to make up for the loss.
According to reports, China is also among the countries whose travel and tourism industry is growing at a fast pace, until now. Due to the widespread COVID-19 disease, the gains from the tourism industry may fall by 30% this year as compared to last year. The director of the Tourism Research Centre of the Chinese Academy of Social Sciences (CASS), Song Rui has stated that "This is the deepest and largest impact on China's tourism industry with the broadest range since the reform and opening-up period that began in 1978.”
The travel and tourism industry of India which also faced a set-back due to COVID-19 could lose up to 50 million jobs. Almost 5000 billion rupees are at stake due to this countrywide lockdown. Most of the tourists visit from November to March and as it got hit by the disease from the start of the year it had lost quite a fortune. But what is more worrying is the present situation of the small travel and tourism-related businesses. The cash reserves of several restaurants and hotels are going down and they can lose around 60-70% of revenue compared to the previous year due to a reduction in demands. CII National Chairman Tourism Committee, Dipak Haksar said, "The industry is facing an existential crisis today". He further added that the levels will only return to normal in 2021 if there’s an upgrade to the current picture.
Amidst all this, there are still certain destinations opening up that are safer and better to visit within India, for example, Goa. Check out Global Gallivanting's blog on Goa reopening and everything you need to know about it.
When travel starts again, it'll be cheaper but more dangerous, so certain precautions will need to be taken but that doesn't mean travel is out of the question. Check out Ruby Singh's blog on the best countries for Indians to travel Visa-free for a look at some destinations you can think about and take inspiration from!
These were the main nations whose travel and tourism industry have been hit hard by the spread of coronavirus worldwide although we won’t say that countries like Australia, New Zealand, South Korea, Saudi Arabia besides many small island countries aren’t affected. They are also under great pressure. While the governments of all countries are trying their best to give out resources to this sector, we can only hope for the scenario to get better as this prestigious and forever growing industry needs people to be moving for it to grow further. To get some inspiration to travel within India, check out our Experiences page with a range of volunteering, learning, and personalized travel experiences that you can opt, for safe traveling within India while giving back to society.