Global tourism industry loses $1.3 trillion in 2020 due to pandemic

It was the worst year in tourism history with 1 billion fewer international arrivals, UNWTO says

Snow covers mostly empty holiday homes in Niseko, Japan, one of Asia's most popular ski resorts. Getty

The collapse in international travel due to the Covid-19 pandemic led the global tourism industry to lose $1.3 trillion in export revenue, almost 11 times more than the loss recorded during the 2008 global economic crisis, according to the UN World Tourism Organisation.

Overall, 2020 was the worst year on record for the global tourism industry, with international arrivals dropping 74 per cent annually, the UN body found.

Global destinations welcomed 1 billion fewer international arrivals last year than 2019. Main drivers propelling this sharp drop were an "unprecedented fall in demand and widespread travel restrictions".

"While much has been made in making safe international travel a possibility, we are aware that the crisis is far from over," said Zurab Pololikashvili, the secretary general of the UNWTO.

The Covid-19 pandemic put between 100 million and 120 million direct tourism jobs at risk, many of them in small and medium-sized enterprises.

Tourism is among the sectors hardest hit by the global pandemic, which has severely curtailed travel. As some countries begin to gradually reopen their borders and ease restrictions, global industry bodies are calling for a harmonised approach to restarting travel.

The ongoing distribution of Covid-19 vaccines is expected to help "restore consumer confidence". It could contribute to "easing travel restrictions and slowly normalising travel during the year ahead", the UNWTO said.

"The harmonisation, co-ordination and digitalisation of Covid-19 travel-related risk reduction measures … including testing, tracing and vaccination certificates, are essential foundations to promote safe travel and prepare for the recovery of tourism once conditions allow," Mr Pololikashvili said.

However, the latest survey by the UNWTO’s panel of experts revealed a mixed outlook for this year.

About 45 per cent of the respondents expect better prospects for 2021 compared to last year. A quarter of experts predict a similar performance and three in 10, foresee a worsening of results in the coming months.

The overall prospects of a rebound in 2021 seem to have worsened.

Half of the respondents expect the industry to recover only in 2022. The remaining half of respondents still see a potential rebound in 2021, though below the expectations shown in the October 2020 survey (in which 79 per cent expected recovery in 2021).

Furthermore, a majority of experts do not to see a return to pre-pandemic levels happening before 2023.

Almost 43 per cent of the respondents believed 2023 would be the year for recovery, while 41 per cent expect a return to 2019 levels will only happen in 2024 or later.

The UNWTO’s extended scenarios for 2021-2024 indicate it could take two and a half to four years for international tourism to return to 2019 levels.

"This crisis is an opportunity to rethink the tourism sector and its contribution to the people and planet," Mr Pololikashvili said.

"[It] is an opportunity to build back better towards a more sustainable, inclusive and resilient tourism sector that ensures the benefits of tourism are enjoyed widely and fairly," he added.

The Asia Pacific region is the first to suffer the impact of the pandemic and the one with the highest level of travel restrictions currently in place. It recorded an 84 per cent decrease in arrivals in 2020, according to the UNWTO. It was followed by the Middle East (76 per cent) and Europe (71 per cent).

Africa and the Americas suffered a decline of 70 per cent and 69 per cent, respectively.

Global air passenger traffic is unlikely to recover to pre-Covid-19 levels before 2024, a year later than previously expected, according to the International Air Transport Association.

International passenger demand continued to be affected by pandemic-related travel restrictions, with demand plunging 88.3 per cent in November compared to the same month last year, according to the association, which is developing a digital health pass to prove passengers have tested negative for Covid-19 or have been vaccinated before travelling.

The UAE’s Etihad Airways and Emirates are already working with the association to adopt its Travel Pass.