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Business Survival Across the Tourism Ecosystem Continues to be at High Risk

The coronavirus (COVID-19) pandemic not only had a significant impact on public health, it also severely affected one of the linchpins of the global economy – the tourism industry. As many countries introduced curfews and travel restrictions to contain the spread of the virus, travel across the world significantly declined from early 2020 onwards. The financial repercussions of the coronavirus have already begun to manifest themselves within the tourism industry.

The outlook for the tourism sector remains highly uncertain. The coronavirus (COVID-19) pandemic continues to hit hard, with international tourism expected to not recover anytime soon. Domestic tourism is helping to soften the blow, at least partially, and governments have taken impressive immediate action to restore and re-activate the sector while protecting jobs and businesses. 

Many countries are also now developing measures to build a more resilient tourism economy post-COVID-19. These include preparing plans to support the sustainable recovery of tourism, promoting the digital transition and move to a greener tourism system, and rethinking tourism for the future.

Tourism continues to be one of the sectors hardest hit by the coronavirus pandemic and the outlook remains highly uncertain.

Destinations that rely heavily on international, business, and events tourism are particularly struggling, with many coastal, regional, and rural areas faring better than cities.

Encouraging news on vaccines has boosted hopes for recovery but challenges remain, with the sector expected to remain in survival mode until vaccination rates are equal across the globe.

Domestic tourism has restarted and is helping to mitigate the impact on jobs and businesses in some destinations. However, real recovery will only be possible when international tourism returns. This requires global cooperation and evidence-based solutions so travel restrictions can be safely lifted.

The survival of businesses throughout the tourism ecosystem continues to be at high risk without continued government support and although governments have taken impressive action to cushion the blow to tourism, to minimize job losses, and to build recovery in 2021 and beyond, more needs to be done, and in a more coordinated way. Key policy priorities include:

  • Restoring traveller confidence
  • Supporting tourism businesses to adapt and survive
  • Promoting domestic tourism and supporting safe return of international tourism
  • Providing clear information to travellers and businesses, and limiting uncertainty (to the extent possible)
  • Evolving response measures to maintain capacity in the sector and address gaps in supports
  • Strengthening cooperation within and between countries
  • Building more resilient, sustainable tourism

While flexible policy solutions are needed to enable the tourism economy to live alongside the virus in the short to medium term, it is important to look beyond this and take steps to learn from the crisis, which has revealed gaps in government and industry preparedness and response capacity. Co-ordinated action across governments at all levels and the private sector is essential.

The crisis is an opportunity to rethink tourism for the future. Tourism is at a crossroads and the measures put in place today will shape the tourism of tomorrow. Governments need to consider the longer-term implications of the crisis while capitalizing on digitalization, supporting the low carbon transition and promoting the structural transformation needed to build a stronger, more sustainable, and resilient tourism economy.

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