European tourism sector urges measures to mitigate COVID-19 impact

Tourists wearing protective face masks visit St. Peter's Square in the Vatican City on 24 February 2020. [EPA/ANGELO CARCONI]

Europe’s tourism industry is bracing itself for an economic impact that could potentially push several countries into recession, as a result of the ongoing coronavirus crisis on the continent.

Without a steady stream of visitors from outside the bloc, the European tourism industry alone is said to experience an estimated financial loss of roughly €1 billion per month, European Commissioner for Internal Markets Thierry Breton had announced on Monday (16 March).

Concerned with the looming economic impact, the European Tourism Manifesto alliance, representing the European travel and tourism sector, issued a statement on Tuesday (17 March) calling for further measures to limit the COVID-19 impact.

“Support for tourism must be a priority in the crisis response recovery plans and actions of affected economies,” the alliance said in a statement on Tuesday (17 March).

With millions of jobs currently at stake, many small and medium enterprises (SMEs) risk closing their business, the statement added.

The advocacy group welcomed the immediate response presented by the European Commission on Friday (13 March) to mitigate the socio-economic impact of the COVID-19 outbreak.

In its crisis counter-measures, the EU’s executive promised to reallocate unspent structural funds amounting to €37 billion to support health systems, SMEs and affected sectors and workers.

It is also looking at making a further €28 billion of structural funds available.

“We call for immediate implementation of these measures, which should be reinforced by additional instruments focused on the tourism sector,” the alliance urged.

Potential measures should include temporary state aid for the tourism and travel sector from national governments should include fast and easy access to short- and medium-term loans to overcome liquidity shortages, including funds made available by the EU through the Corona Response Investment Initiative, fiscal relief for SME’s and protection of workers from unemployment and loss of income.

In the long-term, the alliance suggests a simplification of visa rules, reducing or waiving travellers’ taxes and supporting economically hit destinations with promotion and marketing to attract tourists and guarantee a  swifts recovery in the aftermath of the crisis.

Corona-plague Italy with serious loss

Europe’s hardest hit country by the coronavirus outbreak, Italy, is expected to suffer an economic hit due to lack of revenue from tourism, especially around Easter, as Rome’s piazzas are expected to remain empty.

All of Pope Francis’ Easter services next month, which usually draw tens of thousands of people to sites in Rome and in the Vatican, will be held without the faithful attending, Vatican announced, in a step believed to be unprecedented in modern times.

Italy could loose up to €4.5 billion in tourism revenue this year as virus fears keep visitor away, according to polling agency Demoskopika.

If the situation continues and virus continues to keep visitors away, Italy could loose up to €7.4 billion between March and the end of May alone, the Confturismo-Confcommercio tourist lobby estimates.

Economic hit on summer destinations

Meanwhile Greece, which has been emerging from a decade-long financial crisis, is expected to suffer from the coronavirus impact on its vital tourism sector, which accounts for around a fifth of Greece’s economy and more than a quarter of jobs, according to the London-based World Travel and Tourism Council.

Greek hotels generated revenue of €8.7 billion in 2019, a rise of more than 7% compared with 2018, according to HCH data.

In Spain, the virus will undoubtedly have “a direct impact on tourism and on many sectors of the Spanish economy”, the country’s tourism secretary, Isabel María Oliver, told a Spanish news agency.

Meanwhile, Portugal’s tourism industry is already feeling the impact of coronavirus with 60% of hotels in the southern Algarve region reporting cancellations and employers across Portugal fearing the worst is yet to come.

Heavily dependent on tourism, Portugal attracted more than 16.3 million foreign visitors last year, up from about 10 million in 2014, when the economy slowly started to recover from the country’s debt crisis.

The sector contributed 14.6% to gross domestic product in 2018, according to latest official data.

Drastic measures in Europe’s High North

For winter-tourism in Europe’s High North, one of the fastest-growing businesses in northern Norway, the measures taken to slow the coronavirus outbreak could mean a total economic meltdown as many operators announced layoffs, while others are closing activities entirely for the rest of the season, the Barents Observer reported on Sunday (15 March).

Tromsø and northern municipalities impose quarantine restrictions on travellers from southern Norway and foreigners, in an effort to slow down the spread of the virus.

Strict 2-week-quarantine measures will apply to the Lofoten, Vesterålen, and Tromsø, regions inside the Arctic Circle that usually see a high number of tourists.

[Edited by Samuel Stolton]

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