Coronavirus: What is awaiting tourism?

25 March 2020

We are publishing an analytical review of the industry’s prospects prepared by Projects Director of the Gorchakov Fund Victoria Puzanova:

“The continued spread of the new coronavirus has become one the greatest threats not only to the population of the planter, but also to the world economy and the financial markets. Large international institutions and banks have decreased the number of their projects for the nearest future. Tourism, the most vulnerable sector of economy, is already facing serious financial problems.

The coronavirus pandemic, which was announced in March 11 by the World Health Organization, presents a big problem to the global tourism. Almost all countries closed their borders for the entry and because of that many trips were canceled. This creates an additional risk for development of the industry on the background of the weakening world economy, geopolitical, social and trade tensions as well as unequal distribution of the tourist flow on major markets of international tourism.

Considering the developing character of the situation, it is still too early to estimate the full impact of the COVID-19 on the international tourism. In the beginning of the year, the UN World Tourism Organization (UNWTO) reported that the dropdown in the tourism industry would constitute 1-3 % compared to the forecasted growth of 3-4% in the beginning of January of 2020; however, due to the rapid spread of the virus and the implemented restrictive measures in the travel industry, that data will significantly change.

The recent data provided by the World Travel & Tourism Council (WTTC) states that in 2020 the number of trips all over the world will decrease by 25%. Thus, losses in the area of tourism and global leisure travel can constitute up to 2.1 trillion US dollars. The number of jobs subject to risk as a result of the COVID-19 can increase up to 75 million. This can result in a related decrease of jobs in the area of leisure travel and tourism of up to 50%.

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