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Opinion| COVID-19 and the impacts on tourism - Daily News Egypt

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Opinion| COVID-19 and the impacts on tourism

‎Modern tourism is closely linked to development and encompasses a growing number‎ of new destinations. These dynamics have turned tourism into a key driver for socio-‎economic progress.‎


Over the decades, tourism has experienced continued growth and deepening ‎diversification, to become one of the fastest growing economic sectors in the world. 

‎Modern tourism is closely linked to development and encompasses a growing number‎ of new destinations. These dynamics have turned tourism into a key driver for socio-‎economic progress.‎

This global spread of tourism in industrialised and developed states has produced ‎economic and employment benefits in many related sectors – from construction to‎ agriculture or telecommunications.‎

The contribution of tourism to economic well-being depends on the quality and the ‎revenues that tourism offers. 

In 2019, the business volume of tourism equalled or even surpassed that of oil exports, ‎food products, or automobiles. Tourism has become one of the major players in ‎international commerce, and represents at the same time one of the main income ‎sources for many developing countries.

Unfortunately, since the beginning of 2020, the world has changed dramatically. It is the first time that a crisis such as the novel coronavirus (COVID-19) pandemic has occurred in history, and which has led to a major recession on the global level. 

The magnitude and speed of collapse in activity that has followed is unlike anything experienced in our lifetimes. The current crisis not only affects human health, but also affects all the different economic sectors in all countries.

As a result of the COVID-19 pandemic and the measures taken by countries to control and contain the virus, many sectors such as tourism and air transport between countries were closed, which led to an economic recession at the global level.

The global economic impacts from COVID-19 in 2020 were extremely harsh. In terms of the Global Economy, a loss of about 5.2% in world GDP occurred – compare this to the rate of decline during the 2009 global financial crisis which was -0.1%. 

On Trade, a fall of global merchandise trade volume by -9.2% occurred compared to 2019. Travel & Tourism GDP losses stood at $4.7trn. The loss of tourism revenue was about $1.3trn, along with the loss of more than 1.1 billion tourists worldwide. The global Travel & Tourism sector was projected to shed 174 million jobs

In air transport, the total losses in 2020 amounted to $118bn, and demand decreased by -65.9% from 2019. Globally, the total number of airline passengers was only 1.8 billion during the past year, compared to 4.5 billion passengers in 2019, meaning that the COVID-19 crisis has destroyed more than 15 years of growth in passenger traffic.

During the past year also, the total number of Revenue Passenger Kilometres (RPKs) decreased by 66% over the course of the year.

The year 2020 was the worst year in the history of global tourism. According to the latest data from the World Tourism Organization (UNWTO), global tourism suffered its worst year on record, as the number of international tourists decreased by -74%. 

Destinations around the world received 381 million international tourists, which is 1.3 billion less than the previous year, in 2019, due to an unprecedented drop in demand and widespread travel restrictions.

This collapse in international travel represents an estimated loss of $1.3trn in tourism revenues, more than 11 times the losses recorded during the global economic crisis in 2009. The crisis has also jeopardised between 100 and 120 million direct tourism jobs, in addition to causing financial problems for many companies, especially small- and medium-sized enterprises (SMEs).

Given the evolving nature of the epidemic, many countries are now re-imposing stricter travel restrictions, such as mandatory testing, quarantine and in some cases complete border closures, all of which affect the resumption of international travel and tourism.

In 2020, all regions of the world have been affected by the epidemic and record close proportions of decline compared to the previous year 2019 as follows:

  • The Asia-Pacific region recorded a decline of -84%, with a total of 57 million, and is the region most affected by the epidemic, and the one with the highest level of travel restrictions in force.
  • The Middle East recorded a decrease of -76%, with a total number of 16 million tourists.
  • Europe recorded a decline of -71%, with a total number of 221 million tourists, despite a small and short-term recovery in the summer of 2020.
  • Africa recorded a decrease of -70%, with a total number of 17.8 million tourists.
  • The Americas recorded a decrease of -69%, with a total number of 69 million tourists.

Arab countries also recorded a significant decline in inbound tourism in 2020 as follows:

  • The UAE: 5.5 million tourists, a decrease of -67%.
  • Saudi Arabia: 4.1 million tourists, a decrease of -76.4%.
  • Egypt: 3.6 million tourists, a decrease of -72%.
  • Morocco: 2.7 million tourists, a decrease of -79%.
  • Tunisia: 2 million tourists, a decrease of -78.7%.
  • Jordan: 917,000 tourists, a decrease of -72.5%.
  • Bahrain: 833,000tourists, a decrease of -78.1%.
  • Oman: 675,000 tourists, a decrease of -73.1%.
  • Qatar: 646,000 tourists, a decrease of -69.2%.
  • Lebanon: 541,000 tourists, a decrease of -71.5%.
  • Palestine: 172,000 tourists, a decrease of -75%.

Expectations for recovery remain cautious. The latest survey conducted by the UNWTO’s expert committee showed that expectations for 2021 are mixed. 

Nearly half of respondents (45%) envisioned better prospects for 2021 compared to last year, while 25% expected a similar performance and 30% expected a deterioration in results in the current year compared to 2020.

The overall projections for recovery in 2021 by the team of experts are as follows:

  • 50% of the team expect a potential recovery during the current year 2021 (of whom only 4% expect the start of recovery from the second quarter (Q2) of the current year, 27% expect to recover from Q3 of the current year, while 18% expect the start of the recovery from Q4 of 2021).
  • 50% of the team expect a real recovery only in 2022.
  • Most of the team of experts expect an increase in the demand for outdoor tourism activities and nature-based tourism activities, with the recovery for those segments set to take place faster than other tourism types.
  • Looking to the future, most experts see the return of international tourism movement to pre-pandemic levels no earlier than 2023.
  • 43% of the expert team expects the return of international tourism to normal in 2023, while 41% of them expect that the return of international tourism to 2019 levels will not occur until 2024.
  • Regarding tourism patterns, Leisure Tourism is expected to recover faster than Business Travel and other tourism patterns.
  • As for regions of the world, it is expected that the Middle East and Africa regions will be the fastest at the beginning of the recovery, as most experts expect the beginning of the recovery during Q3 of this year 2021. As for the rest of the world, the date of the recovery varies, but the overwhelming expectations believe that the recovery will not begin before the beginning of 2022.

In general, the UNWTO scenarios extending from 2021 to 2024 indicate that it may take two and a half to four years for international tourism to return to 2019 levels.

At the same time, the gradual deployment of COVID-19 vaccines is expected to help restore the confidence of tourism consumers, and contribute to easing travel restrictions and returning travel to normal during the current and next two years.

Regarding Egypt, I think that in light of the current circumstances, it is expected to start resuming the tourism movement to Egypt as of Easter in April or at the latest in May this year.

It is expected that the recovery will be turbulent during the next summer season in 2021, provided that the real recovery begins from the winter 2021-2022 season (that is from October/November 2021).

I personally expect that the demand will stabilise and that the reservation rates for the 2021-2022 winter season will be very good and stable.

My expectation is also that Egypt, as a tourist destination, will be one of the fastest tourist destinations in terms of recovery rates, as demand is strongly present but in a state of extreme latency or what we call a pent-up demand. 

This will be launched as soon as the disappearance the COVID-19 imposed limits occurs, which are fear of infection, strict travel restrictions and procedures that spoil the pleasure of travelling.

Said El Batouty, UNWTO economic adviser and member of the UN Economic Commission for Europe, a board member of the German Travel association, Professor of International Macroeconomics and Tourism Economics at Frankfurt University, Member of the European Travel Commission.

Topics: COVID-19 tourism

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