The tourism industry is unlikely to return to pre-COVID arrival levels until 2023 or later, following the ravaging effect of the coronavirus pandemic.
This is according to the United Nation’s World Tourism Organization (UNWTO) which reveals that nearly half of the experts interviewed see a return to 2019 levels in 2024 or later.
Quoting its World Investment Report 20201, UNWTO says the main barriers of full recovery are travel restrictions, slow containment of the virus, low traveler confidence and a poor economic environment.
Dubbed ‘COVID-19 and Tourism’, the report reveals that travel has adapted to the impact of COVID particularly in terms of travel restrictions.
“Domestic travel has increased, but this does little to help developing countries that are dependent on international travel. Retirees, who tend to spend more per trip, are more likely to stay at home,” the report says.
In Kenya for instance, domestic tourists cut their holiday expenditures by 37.5 percent in 2020, amid massive job losses and pay cuts occasioned by the pandemic.
The Tourism Research Institute (TRI) last month said the average expenditure on package trips dropped from Sh44, 043 in the pre-Covid period to Sh27, 545 during the pandemic.
The institute also estimated that it would take another three years before arrivals in Kenya rebound to the pre-Covid levels, pointing to prolonged pain for the tourism sector.
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The UNWTO report also revealed that younger travelers, such as backpackers, who seem more willing to travel during this pandemic, tend to stay longer but spend less than older travelers.
Cruise ships, involving extended confinement, are likely to be less popular.
Developing countries dependent on cruise ship arrivals may need to diversify their industries.
In Kenya, the government has been working on reviving cruise ship tourism, one of the fastest growing maritime sectors in the world.
According to the Business Daily, the country has built a Sh1.3 billion cruise ship terminal at the port of Mombasa which has been lying idle due to coronavirus pandemic.
COVID-19 impact on tourism
The UNWTO report indicates that the proportion of vaccinated people can be an indicator of tourists’ wanderlust and their possibilities to travel.
Although the proportion in the countries of origin as well as in the destination can be decisive, it is likely that tourists will nevertheless hesitate to travel long-distance, preferring closer destinations with high vaccination levels.
“The share of vaccinated people varies significantly across countries, from below 1 percent to over 60 percent,” UNWTO says.
The report notes that it is likely that tourism in countries with a high share of vaccinated people will rebound faster than in countries with a low share.
Travel within Europe and North America, for example, is likely to pick up faster beginning this summer than many developing countries, which are still struggling to get sufficient vaccines and are thus expected to rebound slower.
In Kenya, June 2021 MPC’s Private Sector Market Perceptions Survey, CEOs Survey, and the Survey of Hotels revealed general optimism about economic growth prospects for 2021.
Respondents attributed this optimism to the continuing vaccinations and easing of COVID-19 containment measures.
In the wide East African region, data by EAC indicates that low access to vaccines; slow vaccine roll-out and potentially high cost of vaccinations risk have been noted to be holding back the recovery of the region’s economies.
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Outlook
Going forward, the report has three possible scenarios for the year. First, there could be a reduction in tourist arrivals as observed in 2020.
“Reductions averaged 74 percent with consideration variation between countries. This average reduction is close to the 75 percent reduction in UNWTO’s pessimistic scenario.”
Second, there could be a reduction in arrivals averaging 63 percent, which the UNWTO sees as an optimistic outcome in 2021.
The third scenario takes into account varying rates of vaccinations and assumes a 75 percent reduction in countries with low vaccination rates, and a 37 percent reduction in countries with relatively high vaccination rates.
“The cut-off point is economies with 50 percent of their population vaccinated at the end of May.”
