The global tourism sector could lose at least $ 1.2 trillion, or 1.5% of the world’s Gross Domestic Product (GDP), by standing for almost four months due to the coronavirus pandemic, UNCTAD said in a report published on 1 July.
Tourism is an important source of employment worldwide. The labor market has some distinctive features. Industry is labor intensive in nature.
A large proportion of the jobs are done by women, 54%, significantly higher than in most other sectors, and young employees, which means that the industry is considered inclusive.
However, women are more likely to be entrepreneurs in tourism than in other sectors, and most women have low-skilled jobs in the tourism sector, making them vulnerable to shocks.
There is also a significant amount of indirect employment in construction and infrastructure development, in addition to supplying food and drinks and souvenirs to tourists.
In addition, many employees have direct contact with tourists at travel agencies, airlines, ships, hotels, restaurants, shopping malls, and various tourist attractions.
Tourism and projections
The UN trade and development agency warned that the loss could amount to $ 2.2 trillion or 2.8% of world GDP if the interruption of international tourism lasts for eight months, in line with the expected decline in tourism as projected by the UN World Tourism Organization (UNWTO).
UNCTAD estimates losses in the most pessimistic scenario, a 12-month recess in international tourism, at 3.3 billion or 4.2% of world GDP.
Tourism is a backbone of the economies of many countries and a lifeline for millions of people around the world, with a value that has more than tripled from 490 billion to 1.6 trillion in the past 20 years, according to the UNWTO.
But Covid-19 has stopped it, causing serious economic consequences worldwide.
Pandemic
Covid-19 is a global health and economic crisis. While little is currently known about many aspects of the disease (such as asymptomatic transmission, preventive measures, possible treatments, the likelihood of a vaccine, and long-term effects), it is generally accepted that the virus is easily transmissible. and that the mortality rate is low compared to previous pandemics such as SARS, Ebola, and bubonic plague.
Deaths are highly biased towards older people and people with existing ailments.
Overall, prevailing blockade measures in some countries, travel restrictions, reductions in consumer disposable income, and low levels of confidence could significantly slow the sector’s recovery.
Although tourism is slowly restarting in an increasing number of countries, it remains stagnant in many nations.
«These figures are a clear reminder of something we often seem to forget: the economic importance of the sector and its role as lifeguards for millions of people around the world,» said UNCTAD director of international trade Pamela Coke-Hamilton.
«For many countries, like small island developing states, a collapse in tourism means a collapse in their development prospects. This is not something we can afford, «he added.
Developing countries could suffer the greatest losses in GDP. Jamaica and Thailand stand out, losing 11% and 9% of GDP, respectively, in the most optimistic scenario of UNCTAD estimates. Other critical tourism spots such as Kenya, Egypt and Malaysia could lose more than 3% of their GDP.
But the tourism sector in many wealthy nations will also feel the pressure. According to UNCTAD forecasts, popular destinations in Europe and North America, including France, Greece, Italy, Portugal, Spain and the United States, could lose billions of dollars due to the dramatic drop in international tourism.
