World Tourism Day: Why restoring tour and travel is critical to jumpstart global economic recovery in COVID-19

COVID-19 pandemic has triggered an unprecedented crisis in the global economy. The impact of the crisis is being felt throughout the entire world economy, however, it can be safely said that the tourism ecosystem is most affected. Today, on World Tourism Day, here’s taking a close look at how restarting tourism, domestic and international, can help in jumpstart global economy.

World Tourism Day is celebrated on 27 September every year since 1980. The UNWTO (The World Tourism Organization), which promotes responsible, sustainable, and universally accessible tourism, stimulates economic growth and job creation. It has chosen ‘Tourism for Inclusive Growth’ as this year’s theme. As the tourism industry slowly bounces back amidst the lingering perils of the pandemic, registering economic growth, this theme is significant and apt.

According to a report by United Nations, tourism could deal $4 trillion blow to the global economy, due to COVID. This could rise to 80 percent, if recovery is delayed until December, according to a study published by Organisation for Economic Co-operation and Development. Domestic tourism, which accounts for around 75 percent of the tourism economy in OECD countries, is expected to recover more quickly. It offers the main chance for driving recovery, particularly in countries, regions and cities where the sector supports many jobs and businesses.

Domestic tourism

According to a report by Asian Development Bank, many countries are looking to domestic tourism to help stimulate economic recovery. It is an attractive option, particularly for countries like India, which is diverse and where there are existing strong domestic tourism markets. However, for economies highly dependent on tourism, or international tourists like Palau, and Maldives, domestic tourism is not a viable option to restart the economy.

Furthermore, promoting domestic tourism is difficult. In the post-COVID era, many people will have less disposable income for leisure activities like travel, and social distancing and other containment measures may make it unappealing. So, for highly tourism-dependent economies, it makes sense for governments to support tourism enterprises to rebuild and reform.

The Indian government has started the tourism programme ‘Dekho Apna Desh’ along with special tourist trains, incentives to boost demand. Marketing initiatives promoting domestic travel has been beneficial for many countries. For instance, while in the pre-pandemic times, travelling for Britons, meant visiting countries in Europe or Asia, after COVID, thanks to the ‘Escape the Everyday’ campaign by England.

Travel bubbles

Establishing bilateral travel bubbles is an interesting option to revive tourism, which has proved much effective. The Indian government has been beneficial with the travel bubble. This has allowed non-residential Indians to return home and even travel to meet their loved ones, adding to the Indian economy. However, bilateral agreements are subject to rapidly changing epidemiological circumstances.

It is important to remember that travel bubbles are only a second-best option, which should only be temporarily in place. The Maldives is open for international tourism. They have established guidelines around health checks for inbound tourists and protocols in the event of an outbreak. They are supported by their “one island one resort” tourism model which affords natural social distancing.

Vaccination and recovery

With vaccinations being rolled out in most developed economies, one may imagine that recovery is significantly closer. Unfortunately, it is not. Vaccination, in most countries, is very slow, putting many tourism workers at risk, thus affecting the supply side. Their families are becoming poor, they are changing jobs, too, to survive.

Tourism workers in developing economies, including destinations such as small island developing states, where tourism is a lifeline and a key driver of development, are, particularly at risk. On the other hand, travellers’ confidence is affected by the changing travel restrictions, putting their travel plans at risk.

Added to that, the costs of tests, a lack of coordination and clarity over regulations and the cancellation or rescheduling of flights, and general uncertainty is making people remain wary of travelling.

Pandemic induced rising inequality

Growing inequality is one of the biggest economic, social and political challenges of the COVID-19 era. While a section of people is vaccinated and gearing to travel, many are grappling with the virus. On top of that, people were pushed into extreme poverty due to the pandemic. The poor and vulnerable people have been hit the hardest by this situation, where travelling is but a luxury that they can’t afford.