COVID-19 Crashed the Tourism Industry

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SEATTLE, Washington — Prior to the COVID-19 pandemic, the allure of travel evoked a longing for adventure in the minds of many. A growing middle class, particularly in developed countries, encouraged the exponential growth of the tourism industry worldwide. COVID-19 crashed the tourism industry. Even though it is hitting the economies of developing countries the hardest, the detrimental effects will be felt by all. Losses extend beyond economics since exposing people to new cultures encourages a more open-minded worldview. There is concern that prolonged isolation and a climate of uncertainty will contribute to a rise in nationalism.

Tourism’s Resonating Economic Effect

The economic benefits of tourism are significant in nearly every country not at war. While it is an important part of the economy of many developed nations, developing nations, such as Laos, rely on the industry as a pillar of economic stability. As tourism is a major cornerstone to developing economies, shutting off that consistent flow of funds can be devastating, even deadly. Tourism keeps the lights on for countless families.

With stay-at-home orders and travel bans in effect around the world, COVID-19 crashed tourism indefinitely as the industry has closed its doors. A recent United Nations article put forth the notion that “…the adverse effects of prolonged economic restrictions in developed economies will soon spill over to developing countries via trade and investment channels.” This economic chaos will not stay contained. It is not an isolated issue that will dissipate quietly.

Tourism Industry Runs Dry

While some larger companies have cash on hand to cover expenses for the time being, it is considerably harder for many smaller tourism companies and freelance guides to survive a financial drought. To get a better understanding of how the fact that COVID-19 crashed tourism is affecting industry workers in developing countries, The Borgen Project reached out to several affected individuals. One of them, a local tour guide in Laos named Souk, told the magazine that tourism was the third-largest generator of income in the country.

When asked about the effect of the global pandemic on him, he stated: “. . . it’s a big impact on my life and my family because I have lost my income and don’t have any government pension. So, we will be hungry.” His reference to the lack of governmental financial assistance showcases the absence of even a modest financial safety net comparable to what some developed countries have been able to provide. As Souk is a freelancer, he is particularly vulnerable and has no vacation time or employer assistance to see him through.

Long, a tour guide who lives and works in Cambodia, spoke to the magazine about how his country also relies heavily on tourism for income. The United Nations is aware of such economic pitfalls in developing countries, expressing a concern that, “Governments may be forced to curtail public expenditure at a time when they need to ramp up spending to contain the pandemic and support consumption and investment.” This raises concerns about the lack of a financial cushion ultimately hindering more than just the individual. The way that COVID-19 crashed tourism and hit developing economies the hardest shows how essential the industry is to global financial stability.

Potential Downturn in Pandemic Severity

Social distancing measures are the best means available to mitigate the spread of COVID-19. They prevent as many deaths as possible as well as long-term economic breakdowns. A number of countries, including several European nations and China, are reporting diminishing numbers of new cases, suggesting a downturn in the infection rate. This may indicate an end in sight to the pandemic’s severity. When the world reopens and people feel safe to move about again, the tourism industry can begin rebuilding itself.

Despite this good news, it is important to note that prematurely opening businesses will undo much of the progress made in the fight to contain COVID-19. Health experts have warned of a potential “deadly resurgence” from a “second wave” of COVID-19 cases if the world tries to get back to “normal” too impulsively.

Social distancing measures will not entirely solve the problems to come. Dealing with this deadly threat is a necessity, albeit a disruptive one, but governments and citizens also need to find ways to take on the poverty resulting from such a massive disruption. The current consensus among economists is that, due to the way COVID-19 crashed the tourism industry, there will be severe effects on the global economy. However, on its own, is unlikely to trigger a worldwide recession. While that bears some resemblance to a silver lining, the tourism industry is ultimately one of many economic hits lining up.

A Hopeful Future

The Laotian tour guide Souk believes, “ . . . the tourism industry will continue to slowly grow up again, but it will take at least two years to get back to normal.” Post-pandemic, there will be a long road to rebuild the freedom many have become accustomed to thanks to the tourism industry and the global economy. COVID-19 crashed the tourism industry, but history has shown humanity’s remarkable ability to bounce back. In a time when many feel isolated and disconnected from their former lives and from each other, perhaps travel and tourism can bring people back together. In the meantime, avid travelers are recommending spending some quarantine time researching future adventure destinations, looking forward to a hopeful way to usher in a post-pandemic future.

Jack Leggett III
Photo: Unsplash

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