The financial repercussions of the coronavirus have already begun to manifest themselves within the tourism industry, and annual forecasts are painting a bleak picture. In 2020, global revenue from the travel and tourism industry is estimated to drop from a forecasted 711.94 billion U.S. dollars to 568.6 billion U.S. dollars, representing a decrease of over 20 percent. While this trend will likely be visible around the world, some regions are predicted to face more substantial blows than others. According to the latest estimates, Asia will see the highest overall drop in travel and tourism revenue in 2020, with China accounting for the lion’s share of lost revenue.
As the point of origin of the novel coronavirus outbreak, the Asia-Pacific region was and continues to be severely affected by COVID-19 and its wide-ranging containment measures. Many of the region’s leading tourist destinations, such as Indonesia and Vietnam, saw a double-digit decrease in tourist arrivals at the beginning of the year. But it is not just the absence of incoming tourists that puts a strain on these regions, as outbound leisure and business travel plans are being similarly compromised. Between January 20 and February 9, 2020, flight bookings decreased by over 57 percent in China. As Chinese nationals have become the most frequent global travelers in the world, this high amount of travel cancellations is hitting the international tourism industry particularly hard.
The impact of COVID-19 can also be felt across Europe and the European travel industry. In Italy, one of Europe’s leading travel destinations, tourist arrivals are shrinking due to the country’s quick rise in confirmed coronavirus cases. According to the latest estimates, tourism expenditure will decrease across all major sectors in 2020, with catering and transport projected to see the highest expenditure declines. Depending on the duration of Italy’s current lockdown, the country might lose up to 7.7 billion euros in added tourism value this year. Other European countries are suffering the same fate within their respective travel and tourism industries. In Spain, for example, the coronavirus crisis has led to a large number of hotel cancellations over Easter, forcing many hotel chains to close their doors temporarily. In Paris, one of the most-visited cities worldwide, hotel occupancy rates have dropped from 84 percent in January 2020 to a mere 1.8 percent in March. As well as its impact on travel and hospitality, the global pandemic is also taking a heavy toll on the food service industry. In the United Kingdom, the government-imposed closure of all pubs and restaurants on March 21 has led to a 100 percent year-over-year change in seated restaurant diners, and as public restrictions are set to remain in place for the weeks to come, the food service industry is unlikely to recover anytime soon.
In the United States, the new epicenter of the pandemic, the negative ramifications of the coronavirus on the travel industry are also increasing by the day. Due to the recently imposed travel ban for European visitors, the country estimated a visitor loss of around 850,000 and a visitor spending loss of 3.4 billion U.S. dollars for the month of March alone. Depending on the percentage drop in occupancy, the hotel industry might lose up to 500 billion U.S. dollars in GDP contribution in 2020 and a loss of 6.5 million jobs in the hotel sector, respectively.