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International tourism is set to plunge by 80% this year – but some regions could recover more quickly

Millions of jobs could be lost in an industry that provides high levels of employment.
Less developed economies could be hit particularly hard.
However, some regions – particularly the Middle East – are forecast to recover more rapidly.
Experts say the crisis offers an opportunity to rebuild global tourism in a more sustainable way.

COVID-19 has closed hotels and grounded planes for many weeks. Now the human cost of this standstill is coming into focus.

Between 100 and 120 million jobs in tourism are at risk as a result of the collapse in demand for international travel, predicts the World Tourism Organization (UNWTO).
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In March, the World Travel and Tourism Council forecast that international travel could fall by up to 25% this year; the UNWTO now anticipates a 60-80% decline. When and where the industry recovers will depend largely on when governments ease restrictions.

But while the UNWTO warns the crisis could threaten progress on the UN’s Sustainable Development Goals (SDGs) for tourism, others in the industry say there is now an opportunity to rebuild in new, more sustainable ways.
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Tourism has fallen around the world since the start of the pandemic.
Image: UNWTO

Millions affected

The coronavirus pandemic is “the worst crisis that international tourism has faced since records began (1950),” according to the UNWTO.

Globally, tourist arrivals were down by 22% in the first three months of the year, collapsing by 57% in March as lockdowns spread. That’s some 67 million lost passengers.
What is the World Economic Forum doing about the coronavirus outbreak?

A new strain of Coronavirus, COVID 19, is spreading around the world, causing deaths and major disruption to the global economy.

Responding to this crisis requires global cooperation among governments, international organizations and the business community, which is at the centre of the World Economic Forum’s mission as the International Organization for Public-Private Cooperation.

The Forum has created the COVID Action Platform, a global platform to convene the business community for collective action, protect people’s livelihoods and facilitate business continuity, and mobilize support for the COVID-19 response. The platform is created with the support of the World Health Organization and is open to all businesses and industry groups, as well as other stakeholders, aiming to integrate and inform joint action.

As an organization, the Forum has a track record of supporting efforts to contain epidemics. In 2017, at our Annual Meeting, the Coalition for Epidemic Preparedness Innovations (CEPI) was launched – bringing together experts from government, business, health, academia and civil society to accelerate the development of vaccines. CEPI is currently supporting the race to develop a vaccine against this strand of the coronavirus.

The bill for disruption in these first three months is estimated to be around $80 billion in lost tourist receipts – valuable exports which are a much-needed source of income for many nations.

Asia and the Pacific region has been hit hardest, with 33 million fewer arrivals, followed by Europe. The Middle East appears to have been least impacted so far.

There are now “millions of jobs at risk in one of the most labour-intensive sectors of the economy,” says UNWTO Secretary-General Zurab Pololikashvili. Developing economies are expected to suffer the most.

The importance of timing

So how severe is that risk? The UNWTO outlines three scenarios – all with big impacts for the global travel and tourism industry.
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The timeline for lifting restrictions will make a big difference.
Image: UNWTO

The lightest impact is based on the gradual opening of international borders and easing of travel restrictions in early July. This would result in a 58% annual cut in visitor numbers.

Easing restrictions in early September will produce a bigger fall, at 70%. And if restrictions aren’t loosened until early December, that could reach 78%.

The timing means the difference between the loss of $910 billion or $1.2 trillion in export revenues, and a loss of between 850 million to 1.1 billion international tourists.

What these figures make clear is that whenever restrictions are eased, large impacts are now unavoidable. The real cost to employment is already beginning to be felt, with airlines including British Airways and Virgin Atlantic announcing thousands of job losses.

Recovery scenarios

Despite the economic burden of COVID-19 restrictions, demand will return, says the UNWTO. The questions are when – and where.
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Domestic tourism is expected to recover more quickly than international travel.
Image: UNWTO

The most likely scenario is varying degrees of recovery in different regions at overlapping times.

While there are likely to be signs of recovery by the final quarter of 2020, the UNWTO’s Panel of Experts survey thinks the bulk of improvements will not come until next year.
Aviation
What is the World Economic Forum doing to reduce aviation’s carbon footprint?

As other sectors proceed to decarbonize, the aviation sector could account for a much higher share of global greenhouse gas (GHG) emissions by mid-century than its 2%-3% share today. With the number of air travel passengers expected to double by 2035, there’s a strong urgency for the aviation industry to act to ensure it can meet this demand in an environmentally sustainable manner.

Sustainable aviation fuels (SAF) can reduce the life-cycle carbon footprint of aviation fuel by up to 80%, but they currently make up less than 0.1% of total aviation fuel consumption. Enabling a shift from fossil fuels to SAFs will require a significant increase in production, which is a costly investment.

Launched in September 2019, the Forum’s Clean Skies for Tomorrow (CST) Coalition is a global initiative driving the transition to sustainable aviation fuels (SAF) as part of the aviation industry’s ambitious efforts to achieve carbon-neutral flying.

Run in collaboration with the Energy Transitions Commission and the Rocky Mountain Institute, with the Air Transport Action Group as an advisory partner, CST brings together government leaders, climate experts and CEOs from aviation, energy, finance and other sectors who agree on the urgent need to help the aviation industry reach net-zero carbon emissions by 2050.

Learn more about the Clean Skies for Tomorrow Coalition’s impact and contact us to find out how you can get involved.

The experts forecast the Middle East, Europe, Africa, and Asia and the Pacific are likely to experience some recovery this year – with the Americas most likely to take longer.

Bouncebacks could vary by sector: domestic demand is expected to recover faster than international demand, and leisure travel – especially visiting friends and relatives – should rebound sooner than business travel.
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The Middle East is most likely to see an early recovery.
Image: UNWTO

Building back better

This unprecedented challenge to the travel and tourism sector puts livelihoods at risk, but also “threatens to roll back progress made in advancing the Sustainable Development Goals (SDGs),” according to the UNWTO.

The agency has been promoting improving the sustainability of tourism on a range of levels – from gender equality to clean water and sanitation – by 2030.

However, with social distancing upending the mass tourism paradigm, some are now wondering if COVID-19 could present an opportunity for a more responsible way of travelling.

“I don’t think that ‘where shall we go in Europe for the weekend?’ approach is going to come back in the same casual manner,” Tony Wheeler, co-founder of the travel publisher Lonely Planet, tells British newspaper the Financial Times. Others are more cautious in their predictions.

“If there is an opportunity for the industry to redirect itself and change the face of future holiday products, it is now,” says tourism market researcher Ulf Sonntag in German media outlet Deutsche Welle.

“But whether we have really moved away from mass tourism as we knew it, after the coronavirus crisis remains to be seen.”

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