According to a report by the United Nations Conference on Trade and Development published this Wednesday, the drop in international tourism due to the coronavirus pandemic could cause a loss of more than four trillion dollars in global GDP during the 2020 years and 2021.

The estimated loss is due the direct impact of the pandemic on tourism and its domino effect in other sectors closely related to him.

The report, published in conjunction with the World Tourism Organization, states that international tourism and its highly linked sectors suffered an estimated loss of $ 2.4 trillion in 2020, following a sharp drop in international tourist visits.

Tourism depends on vaccines

A similar loss may occur this year, the report warns, noting that the recovery of the tourism sector will largely depend on the global application of COVID-19 vaccines.

«The world needs a global vaccination effort that protects workers, mitigates adverse social effects and makes strategic decisions in relation to tourism, taking into account possible structural changes, ”said Acting Secretary General of the Conference, Isabelle Durant.

For his part, the secretary general of the UN agency for tourism, Zurab Pololikashvili, assured that this sector “is a lifesaver for millions of people, and advancing vaccination to protect communities and support their resumption is essential for the recovery of jobs and the generation of much-needed resources, especially in developing countries, many of which depend heavily on international tourism ».

Developing countries hardest hit

According to the report, vaccination against COVID-19 is more pronounced in some countries than in others, so economic losses from tourism are reduced in most developed countries, but are exacerbated in developing countries, where the absence of vaccines is keeping tourists away.

Vaccination rates against COVID-19 are uneven across countries, ranging from less than 1% of the population in some countries to more than 60% in others.

According to the report, the asymmetric deployment of vaccines magnifies the economic impact on developing countries, as they could account for up to 60% of global GDP losses.

In addition, the tourism sector is expected to recover more quickly in countries with high vaccination rates, such as France, Germany, Switzerland, the United Kingdom and the United States.

But experts do not expect to return to pre-pandemic levels of international tourist influx. until 2023 or even after.

The main obstacles are travel restrictions, slow containment of the virus, low confidence of people to travel and a poor economic environment.

Despite a rebound in 2021, the losses will be billions

A rebound in international tourism is expected in the second half of this year, but the Conference report continues to show a loss of between $ 1.7 and $ 2.4 trillion in 2021, compared to 2019 levels. .

The results are based on simulations that only reflect the effects of the reduction in tourism, without considering policies that could soften the impact of the pandemic in the sector, such as economic stimulus programs.

The report assesses the economic impacts of three possible scenarios, all of them reflect the reduction of international visits in the tourism sector in 2021.

The first, projected by the World Tourism Organization, reflects a 75% reduction in international tourist visits, this being the most pessimistic forecast, based on the reduction observed in 2020.

In this scenario, a fall in world tourism revenue of $ 948 billion causes a loss in real GDP of $ 2.4 trillion, that is, an increase of two and a half times. This relationship varies greatly according to the countries, since in some there may be a double increase, while in others there may be a triple or quadruple.

According to the report, it is a multiplier that depends on the derived effects in the tourism sector, including unemployment of unskilled labor.

For example, international tourism contributes around 5% of GDP in Turkey and in 2020, the country suffered a 69% drop in international tourist visits.

The drop in tourism demand in the country is estimated at 33,000 million dollars, which entails losses in highly linked sectors, such as the food, beverage, retail, communications and transportation industries.

Turkey’s total production drop is $ 93 billion, about three times the initial impact. Only the decline in tourism contributes to a real GDP loss of around 9%. This decline was partially offset by fiscal measures to boost the economy.

The second scenario reflects a less pessimistic projection and consists of a 63% reduction in international tourist visits.

And the third scenario considers variable rates of national and regional tourism in 2021. For example, it involves a 75% reduction in tourism in countries with low vaccination rates, and a 37% reduction in countries with relatively low vaccination rates. high, mostly developed countries and some smaller economies.

Losses are worse than expected

The reduction in tourism causes an average 5.5% increase in unskilled labor unemployment, with a great variation from 0% to 15%, depending on the importance of tourism for the economy.

Labor accounts for about 30% of spending on tourism services, in both developed and developing economies. The sector employs many women and young people, who have relatively few barriers to entry into this sector.

In July of last year, the United Nations Conference for Trade and Development estimated that a four to twelve month stoppage of international tourism would cost the world economy between $ 1.2 and 3.3 trillion, including Indirect costs.

However, the losses are worse than expected, as even the worst-case scenario forecast last year has turned out to be optimistic, as international travel remains low even after more than 15 months since the start of the pandemic.

International tourist arrivals declined by about 1 billion trips, or 74%, between January and December 2020. If the pre-pandemic months of January and February 2020 are excluded, the drop in arrivals amounts to 84%.

Developing countries have been the hardest hit by the pandemic in the tourism sector. These countries have suffered the largest reductions in tourist arrivals in 2020, estimated at between 60% and 80%.

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