In the last few weeks, the Coronavirus has been breaking down borders like dominoes. We are talking about a situation that, as we are already seeing, continues to spread throughout the global territory, infecting everyone who passes by. A situation that, in the face of the inability of governments, sows chaos in an economy that already showed great signs of exhaustion, even before the viral outbreak shook the various countries that make up the planet.
And the fact is that, worth the redundancy, we continue to see how the virus is getting stronger and stronger in those countries that it shakes. While it passed through the Asian countries in a way that we thought was astonishing at the time, as it advances through the different European countries, the outbreak is gaining more and more strength. And I am not only talking about increases in the rate of infection, but also increases in the rate of death. In other words, more infected, as well as more dead.
A situation which, as we can see and in the face of the figures, generates fear in civil society, confined to their homes and waiting for this unpleasant and lethal virus to reduce its intensity and allow a return to normality. However, I am afraid that months will have to pass before we return to this normality, since the situation seems to be going on for a long time, given the inability to put up health resistance to a virus which, as we can see, leaves behind increasingly less encouraging statistics.
And it is for this very reason that the economy is not recovering. Faced with the situation that the virus is leaving in countries such as Italy and Spain, countries continue to order the confinement of citizens to their homes until this is normalised. These orders, in turn, and as expected, are damaging the economy with every passing day. The paralysis of the global economic activity has been very abrupt, making the giants of Wall Street themselves tremble in the sessions we have lived in the last 3 weeks.
A situation that, within the economic damage, continues to postpone those losses for the tourism sector of which we have spoken so much. At the moment, the state of tourism, and without exception, is a state of coma. Tourism continues to be paralyzed in its entirety, given the degree of progress in the restrictive policies that, in order to paralyze the viral outbreak, are being applied by the respective governments in the countries. These restrictions are aimed at slowing down the border, as well as preventing travellers from moving freely.
A situation that has already put many airlines against the wall, asking governments for ransoms in view of the large losses that are expected. These losses, let us remember, were as high as $113 billion, as already announced by IATA for the air sector. Or losses of $70 billion, as announced by the WTTC for the tourism sector. However, these are losses that could vary upwards and which we do not yet seem to be able to discount.
The fact is that, although we are capable of containing the virus, we are not aware that the tourism sector is a sector that tends to relate to people on a continuous basis. In other words, we are talking about the fact that, in view of the social fear that the Coronavirus has generated, it is not expected that the figures of flights, as well as hotel accommodation and consumption within the tourism sector will be similar to those registered in 2019, at least this 2020. As a whole, and in spite of getting out of the situation in two months, the tourism sector is going to have to continue living with a great stop in its income.
All this, counting on a situation in which the virus disappears in two months, because, as I said, no one rules out that this situation may continue in the long term, leaving more damage, if possible, to the tourism sector itself. A sector that, as the WTTC has announced, is causing losses that, in terms of employment, already amount to the million jobs per day that are no longer being created in the sector by the Coronavirus.
We are talking about a sector that supports more than 10% of the total world gross domestic product (GDP). A sector that, since 2013, has generated 20% of all jobs generated in the world. A sector that has not stopped growing and that, in addition, is better adapted to the different scenarios that the economy may experience. A strategic sector that, in our opinion, has been left under protection, out in the open and in view of the possibility that many of these losses will be consolidated
We need to take action to try to alleviate the situation. I am not talking about resources to rescue airlines, but I am talking about a crash plan to stop the losses in a sector as important as tourism. We are talking about an industry that, at the moment, is completely paralysed, in its entirety. It is time to propose measures to respond to the tourism sector, because, and let us remember the figure, we are talking about a sector that is causing losses of more than 5 billion dollars, as well as a million jobs. And all this, every day that passes.
”
Francisco Coll MoralesEconomist
