Despite devastating blow, Covid19 gives tourism industry a chance to redeem itself

On June 24^th, FIPRA International’s Transport, Travel, and Logistics business unit hosted a FIPRA Intelligence Series webinar on “Framing the restart of tourism: The travel and tourism industry: From boom to bust and boom again?”. 

The webinar discussed how to get the travel and tourism industry back on its feet, after months of lockdown caused by the latest coronavirus outbreak. It was moderated by Helen Marano, Founder and President of Marano Perspectives, and featured a panel of high-level speakers who covered a wide range of topics, notably the global economic environment, consumer trends, industry perspectives, the governmental response and projected impacts. 

Travel & tourism was brought to its knees but there is a new energy to get it right this time. There are upcoming opportunities to rethink how to restart travel and tourism which underscores the imperative for stronger community engagement and broader partnerships, including health authorities.

– Helen Marano, Founder and President, Marano Perspectives

Moderator and long-standing professional of the tourism sector, Helen Marano, highlighted the important timing of the event, which coincided with a challenging time for the industry and when countries progressively start lifting borders. 

While she acknowledged the negative effects of the Covid19 crisis on the tourism industry, Helen insisted that there are upcoming opportunities to rethink how to restart travel and tourism which underscores the imperative for stronger community engagement and broader partnerships, including health authorities. She mentioned how the European Travel Commission (ETC) teamed up with Euronews to create and launch a new media campaign entitled “We are Europe”, designed to inspire people to get ready to travel again as travel restrictions across Europe are gradually being eased.

Many forms of travel & tourism will become less marketable as people will not be spending the money that they used to. Figures seem to indicate that the travel and tourism industry will become more localized, flexible and accessible – with a shift being seen as an industry of overtourism to now being under-tourism.

– Thierry Malleret, Founder, Managing Partner of the Monthly Barometer and Summit of Minds

Thierry Malleret, Founder and Managing Partner of the Monthly Barometer and Summit of Minds, presented his observations on the global economic environment, including salient insights into macro trends and their potential impact on the tourism and travel industry. 

While the crisis comes with a big level of uncertainty, sales rates indicate that people will be less inclined to discretionary spending and the economy is not likely to experience a V-shape recovery. The Covid19 crisis will certainly exacerbate ongoing changes, such as climate awareness, rising inequalities and biodiversity. The figures seem to indicate that the travel and tourism industry will become more localized, flexible and accessible – with a shift being seen as an industry of overtourism, to now being under-tourism.

It’s not about going back to normal and rebound, it’s about change. New concerns and fears around contagion and safety, their future finances, as well as feelings of a lack of control and freedom, will lead to a new normal, hence forcing the travel and tourism industry to adapt.

– Rochelle Turner, Head of Research and Insight, MaCher USA 

On the consumer side, Rochelle Turner, Head of Research and Insight, MaCher USA, set out the trends that will support the transition of the sector. The lockdowns and other restrictions on freedoms have forced people to adapt and discover new habits and behaviors. Research shows that consumers will increasingly pay attention to community, authenticity and considered consumption. New concerns and fears around contagion and safety, their future finances, as well as feelings of a lack of control and freedom, will lead to a new normal, hence forcing the travel and tourism industry to adapt.

It is time for policymakers to get the travel and tourism industry onto a ventilation machine. Every crisis is an opportunity; that is why the time is right to create a new tourism strategy for Europe in a sustainable and long-term manner.

– István Ujhelyi MEP, Vice-Chair of the Transport and Tourism Committee, European Parliament

The European Parliament has been proactively engaging to protect consumers’ rights and save the industry throughout the crisis. MEP István Ujhelyi, Vice-Chair of the Transport and Tourism Committee in the European Parliament, presented the work of the European Parliament and insisted on the importance of continuing community engagement at the European level. His call was threefold: 1) Immediate access to liquidity in the initial phase; 2) Concrete plans for the recovery period and developing a crisis management mechanism for the sector; and 3) the creation of a specific allocation for sustainable tourism in the EU’s budget. 

All of this needs to be built on a new, dedicated EU strategy for tourism, which will set out what legislation is needed to get the industry back on its feet in a sustainable and long-term manner. As MEP Ujhelyi noted, “Every crisis is an opportunity; that is why the time is right to create a new tourism strategy for Europe.”

The industry was hit hard and put on a standstill after a golden era and a decade of sustained growth. People want to travel – they are looking but not booking. Coordination across the globe will be key to prevent a critical impact on industry and jobs.

– Virginia Messina, Managing Director, World Travel and Tourism Council

The industry was hit hard and put on a standstill after a golden era and a decade of sustained growth. Virginia Messina, the Managing Director for the World Travel and Tourism Council, presented the economic impact on the tourism economy to date, and outlined the different scenarios that the industry could face in the months to come. The recovery of the industry will heavily depend on the consistency and coordination of travel restrictions, health and safety protocols, and other measures across the globe. 

The private sector has been working closely with health and safety authorities and destinations to develop safe travel protocols, in a view to rebuild traveler confidence: To date, nine sets of protocols, establishing basic and common standards, have been launched, covering different sectors in the industry (airlines, hospitality, etc.)

The crisis is a big alert to the tourism industry. This is a time to reset. However, let’s make it such that communities are at the heart of it. Tourism remains a global industry and will therefore require strong coordination and harmonization of procedures to allow travel and tourism back in our lives.

– Sandra Carvao, Chief of Tourism Market Intelligence and Competitiveness, UNWTO

As the United Nations specialized agency responsible for the promotion of responsible, sustainable and universally accessible tourism, the UNWTO has played a crucial role in coordinating national responses to support tourism across the globe. Sandra Carvao, Chief of Tourism Market Intelligence and Competitiveness at the UNWTO, closed the discussion with a comprehensive overview of the challenges brought by Covid19 and provided practical insights on how we can face them, from the global perspective. 

While governments have played a critical role in supporting the industry in the early days, tourism remains a global industry and will therefore require strong coordination and harmonization of procedures to allow travel and tourism back in our lives. One particular challenge and opportunity will be to link the support to a more sustainable tourism ecosystem.

Key takeaways

There is no doubt that the industry has been hit – and hit hard. As the UNWTO figures demonstrate, from the last crisis for travel and tourism (post-9/11) the industry suffered a 4% decline. The best-case scenario this year will be a 58% hit, with reality being more likely to decline by an astounding 70%. This is devastating and a true blow to an industry which brings so much to so many. 

The positive side is the chance for the industry to now reset – reset as a political priority, and reset as a sustainable, community engaged industry that does not simply return to “boom”.  

There is broad agreement that we cannot and should not go back to the kind of linear growth that was so highly praised in years gone by but ended with calls from locals for “tourists to go home.” This is a chance for tourism to mean something again and there is hope that those with the power to make it so, will take this opportunity to make it matter.  

On behalf of FIPRA International, the Transport, Travel, and Logistics business unit thanks you for your interest in our event. We plan to organize another webinar in September which will allow us to provide an updated perspective on the effective rebound of the travel and tourism industry, right after the summer season.

Event: Framing the restart of tourism: The travel and tourism industry: From boom to bust and boom again?

Panelists:

• Thierry Malleret, Founder, Managing Partner of the Monthly Barometer and Summit of Minds
• Rochelle Turner, Head of Research and Insight, MaCher USA  
• István Ujhelyi, MEP, Vice-Chair of the Transport and Tourism Committee, European Parliament
• Virginia Messina, Managing Director, World Travel and Tourism Council
• Sandra Carvao, Chief of Tourism Market Intelligence and Competitiveness, UNWTO
• Moderated by Helen Marano, Founder and President, Marano Perspectives