United Nations Conference on Trade and Development (UNCTAD) report reveals that the tourism sector globally could lose an estimate of $1.17 trillion, 1.5 per cent of global GDP due to COVID-19.
The COVID-19 pandemic resulted in countries restricting travels, enforcing lockdowns and suspending businesses in an effort to contain the virus.
The report says, “Extending the four months lockdown to eight and 12 months increases the losses in a fairly linear fashion, to $2.22 (2.8 % of world’s GDP) and $3.3 trillion (4.2% of world’s GDP) respectively.”
“The estimated GDP losses of $3.3 trillion are more than double the size of the international tourism industry alone in the worst-case scenario.”
Prevailing lockdown measures in some countries, travel restrictions, reductions in consumers’ disposable income and low confidence levels could significantly slow down the sector’s recovery according to UNCTAD.
The sector has more than tripled in value from $490 billion to $1.6 trillion in the last 20 years according to the report.
UNCTAD director of international trade, Pamela Coke-Hamilton said, “These numbers are a clear reminder of something we often seem to forget: the economic importance of the sector and its role as a lifeline for millions of people all around the world.”
“For many countries, like the small island developing states, a collapse in tourism means a collapse in their development prospects. This is not something we can afford.”
Effects of the pandemic in the labour force could be particularly negative for women, who are expected to be disproportionately affected by layoffs in tourism due to COVID-19, according to the report.
Women, who are more likely than men to be entrepreneurs in tourism, make up about 54% of the workers in the accommodation and food services sectors.
Due to the fact that many women in the sector work informally in low-skilled jobs, they are less likely to have unemployment benefits or other safety nets.
“This is why women are particularly hard hit in this crisis. And this is why policies that help protect the sector also protect the economic empowerment that many of these women have long fought for,” Coke-Hamilton said.
Reports from Zimbabwe say the country’s tourism sector could lose up to US$1 billion in potential revenue due to the Covid-19 pandemic.
Players in that country’s tourism sector recently agreed on the need for timely disbursement of the $500 million stimulus package by Government.
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