The epidemic caused by the Coronavirus is stalking the tourism sector globally. The blockage caused by the spread of the virus is having serious effects on the world economy.
In recent weeks, the outbreak of Coronavirus in China has shaken the world. Fear of this new, a priori unknown pandemic is wreaking havoc across the planet. The closing of borders by all countries has not only had a great effect on the cancellation of major events such as the Mobile World Congress in Spain, but has also paralysed the transport of passengers around the planet, acting as a blocker to the geographical movements of people on the planet.
Among the sectors most affected by this series of pandemic outbreaks we could highlight the tourism sector. Asia, especially China, is one of the countries with the highest number of passengers boarding throughout the year. The tourist consumption of the Chinese has become an attraction for the main tourist destinations of the world, given their level of consumption in the destinations, as well as the great amount of tourists that are registered throughout the year.
The blockade presented by the pandemic at this time is worrying all tourism agents on the planet, as well as the uncertainty caused by the possibility that the pandemic will last for the next few months. Every day that passes, in this context, the tourism sector is ceasing to win, so we could talk about losses, a large monetary amount, which is not produced by the factors of containment of the virus. These containment factors have a direct impact on global tourism.
The methods being used to treat the virus have been completely extreme. As we said, the closure of borders has been adopted as one of the most effective measures to prevent the spread of the pandemic to other geographical areas. The spread of the virus and the fear that has been generated throughout the world has led to a standstill in the tourism sector, stalking the income of all companies that are linked to the sector in one way or another.
In Spain, for example, the cancellation of the Mobile World Congress has led to the non creation of more than 14,000 direct jobs that were already anticipated by the celebration of the event. This does not include the indirect jobs, as well as the hotel rooms that were being occupied with the celebration of the event in the city of Barcelona. These hotel vacancies, after the cancellation of the meeting, will not produce that income generation that, today and given the proximity to the meeting, will affect, even with losses, for the hotel companies in the Mediterranean country.
To alleviate the effects, even, the hotel businessmen in the city of Barcelona have already announced the sale of all the places cancelled at very cheap prices. The cancellation and the impacts produced have led hotel chains and tour operators to have to offer these places at junk prices, trying to compensate for the situation caused by the Coronavirus and the cancellation of the meeting.
But, as I said, this effect is happening at a global level. Last year, Chinese tourists made about 150 million trips abroad, that is, tourist trips. This large figure, in economic terms, represents a contribution to consumption of close to 130 billion dollars, which Chinese tourists spent in the various sites they visited. Now, given the new scenario, the forecasts already show a significant decrease that adjusts, and not little, the figures for the current year.
According to Oxford University, the United States alone, for example, will lose about 1.6 million tourists this year. A big loss that, seen for other countries more dependent on Asian tourism, will translate into a further decline. And by this I mean countries such as France, Greece, Thailand or Spain, where tourism from Asia is of great importance to the tourism sector.
The now epidemic, which has caused the Coronavirus, as we can see, is damaging the tourism sector considerably. This is forcing countries to cancel all activities scheduled for the beginning of the year, among which we can highlight the sectorial fairs, which are canceling their programs due to the deterioration and blockage that the virus is causing worldwide. A virus that is killing off economic activity, even weighing down the world’s GDP.
In short, the year is not very optimistic for the tourism sector. The effects of the Coronavirus are going to leave great damage on the sector and the action of the Government in this matter is fundamental. We are talking about a sector with a great contribution to the world economy, so the ballast of this, with the decline caused by the effects of the virus, will have a clear negative impact on the world economy, already threatened, on the other hand, by an intense economic slowdown.
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Francisco Coll MoralesEconomist
