Global Tourism Set to Lose $730 Billion in Revenue Due to Pandemic-Related Travel Restrictions

As many countries around the world moved to impose stringent travel restrictions in an effort to mitigate the spread of the deadly pandemic, the global tourism industry has taken a tremendous hit, with international arrivals plunging by a staggering 70% in the first eight months of the year.

According to the UN World Tourism Organization (UNWTO), international arrivals fell by 81% and 79% in July and August respectively, despite historically being the two most busiest months of the Northern Hemisphere travel season. Up until August, the drop in air travel amounts to a decline of 700 million arrivals compared to the same time a year prior. The decline in air travel amounts to a $730 billion loss in export revenues for the international tourism industry, which is over 8 times the loss recorded during the 2009 financial crisis.

All regions around the world have experienced an unprecedented drop in travel since the onset of the pandemic, with Asia and the Pacific, which were some of the first places to suffer from the COVID-19 pandemic, saw arrivals decline by 79% in the first eight months of the year. However, given that the US quickly transitioned into less stringent travel restrictions before the beginning of summer holidays, the Americas only suffered a 65% drop in arrivals.

Likewise, following Europe’s deadly first wave in the spring and resulting lockdowns, the virus remained relatively under control during the summer; as a result, Europe was able to gradually reopen its international borders, and comparatively smaller arrival declines of 72% and 69% in July and August respectively, were recorded. However, the recovery in Europe’s tourism industry turned out to be only short-lived, as a resurgence in cases prompted governments to reimpose advisories and restrictions. Additionally, Asia and the Pacific recorded the steepest decline in those two months, with a drop of 96% in arrivals as China’s borders remained closed for a significant portion of the pandemic.

Nonetheless, demand for travel still remains significantly subdued heading into the fall and winter seasons in the Northern Hemisphere, with the UNWTO projecting an overall drop of 70% for the entirety of the year. Going forward, the agency anticipates that international tourism will rebound by the third quarter of 2021, contingent on the severity of mitigation measures undertaken by governments. Some experts forecast that the lack of a global coordinated response to the pandemic will likely hinder the rebound in international tourism, pushing the recovery into 2022.


Information for this briefing was found via the UNWTO. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

Video Articles

This Is Why Copper Could Explode Next | Ian Harris – Copper Giant

This Is What $3,300 Gold Unlocks | Tara Christie – Banyan Gold

Real Gold Bull Market Energy Is Back | Matthew Roma – Golden Cross

Recommended

Discovery Silver in Advanced Talks to Acquire Barrick’s Last Canadian Gold Mine

Emerita Reports Aznalcollar Public Tender Trial Hearings Have Concluded, Verdict Expected This Fall

Related News

Air Canada: BMO Reinstates Coverage With $33 Price Target

Last week, BMO Capital Markets reinstated their coverage on Air Canada (TSX: AC) after discontinuing...

Saturday, March 6, 2021, 10:17:00 AM

Air Canada Reaches Deal with Government for $5.9 Billion in Loans, Equity

Air Canada has announced it has finally reached an agreement with the Canadian federal government...

Wednesday, April 14, 2021, 11:52:00 AM

IATA: Global Passenger Traffic Plummeted 66% in 2020

Global air passenger levels suffered a dramatic drop in 2020, after numerous countries imposed tough...

Saturday, February 6, 2021, 11:40:00 AM

Airline Groups Propose ‘Digital Health Passports’ in Leu of Quarantines as Pandemic Continues to Cripple Industry

As the recovery for air travel demand continues to be pushed back further and further...

Sunday, November 15, 2020, 03:42:00 PM

IATA Expected to Launch Covid-19 Travel Pass by March

The International Air Transport Association (IATA) recently announced that it will launch its official Covid-19...

Thursday, February 25, 2021, 11:54:00 AM