Corona virus affecting the tourism industry worldwide
Tourism is entering a great crisis due to the worldwide panic of the Corona Virus, duration and scope still unknown, which is leading to the stock market crash continued for a week to all the giants of the sector. The impact of the Covid-19 Corona Virus on world tourism is unquestionable, and the authorities’ forecasts are based on previous experiences with similar crises such as that of SARS or H1N1.
China’s tourism industry will be most affected due to the virus since tourism represents 11% of their GDP in recent years, growing in a steady rate of 7%. The World Tourism Organization (UNWTO) and the World Health Organization (WHO) through a joint statement have asked the tourism sector that their response to the outbreak of the Corona Virus be “measured, consistent and proportionate” to the threat posed for public health. Closing borders, prohibiting travel in general and more extreme government policies will not stop the spread of the Corona Virus, said the World Travel and Tourism Council (WTTC).
Hotels, airlines, and cruise operators are just a few of the hardest hit travel industries that suffer the most immediate repercussions, mainly when the outbreak occurs during the Lunar New Year, one of the busiest travel seasons in Asia.
The impact of the Corona Virus on companies is already global with cancellations of trips, public events, temporary employment adjustments, and falls in income. One of the most extreme cases in Spain is that of the Zurich insurer, which has cancelled all trips of its 2,000 employees both inside and outside of Spain and obliges those who are on a journey to return.
In Europe, Lufthansa’s proposal stands out, which has offered its staff unpaid permits to counteract the negative effects of cancelling flights to China, which will leave 13 planes on the ground. Other companies such as BBVA have cancelled their employees’ trips to the four affected Italian regions, to Japan, Iran, South Korea, Singapore and China. Deutsche Bank also cancelled all trips to Italy.
The International Air Transport Association (IATA) estimates that global air transport revenues will be reduced by 5% this year, which means 29.3 billion dollars less (about 27,000 million Euros), while OPEC has lowered global demand of oil to 19%, 100.73 million barrels per day. The tourism industry is now in unchartered territory with significant losses reported already worldwide panic of the Corona Virus is also seen in the stock market collapses that for days have affected all major airlines, operators and hotels, such as the American, European and Asian ones.
Also, the US authorities dealt a great blow to world tourism, because before the alarm by the Corona Virus the Administration that presides over Donald Trump appealed to companies and public centers to avoid travel and large meetings. These measures will no doubt have a large impact on people’s travel arrangements to one of the most popular leisure destinations in the US in Las Vegas, as authorities will now seek to limit people’s face-to-face interactions, something that should have a positive knock-on effect on the ability of online casino and online betting sites worldwide to capitalize on their shortcomings in the coming weeks.
In China, on the other hand, there is now growing optimism that the epidemic will get under control by late April. Renowned pulmonologist Zhong Nanshan, head of the team of medical experts at the National Health Commission of China, has said that his country is confident of having the outbreak of Corona Virus under control at the end of April, as planned.
The Corona Virus has convulsed the world tourism industry, with large hotel chains and digital platforms such as Booking being forced to cancel reservations in the Asian country. The tourism industry faces an unprecedented confluence of threats – made up of a global health alarm; the shortage of aircraft due to the crisis of the Boeing 737 Max; the social demonization of travel; exaggerated and even false media offensives; climate catastrophes; sector taxes; bankruptcies of operators and airlines; and the political instability and economic slowdown in the large markets – which hints at least a global contraction for the tourism business in the near future.