Worldwide Tourism and hospitality industry is very badly affecting by pandemics, because of the nature of the business which is always related to the travelling of people. History had shown that epidemics and pandemics have an immediate impact on the hotels and restaurants, airlines industries, travel agencies etc, due to the international travel restrictions, media coverage and government measures.
Out there a new deadly virus threatens our lives once more. It’s hard to understand the extent of such a threat, for it has the potential to wipe out millions of us, including my family and yours, over a matter of weeks or months. The effects of the Covid-19 (coronavirus) are not just about those who have caught it. In the meanwhile worldwide economy is crippling with lost production and demand, devastating effects on families and communities in panic and folly and governments taking hasty and catastrophic decisions. As a result countries worldwide will spend years to recover. What about that new virus? Well, it may have started from a bat, but human activity and vanity set it loose. As a matter of fact the virus was first recognized to have infected humans late last year – in an open seafood animal market in Wuhan – and belongs to the coronavirus family. The SARS epidemic as well as the MERS outbreak was caused by coronavirus too. Think about it, human history was messed up with pandemics that have killed millions.
Shouldn't we, in that case, have had to already be prepared and be doing more to prepare for another? We are pretty sure that after coronavirus there will another flu pandemic at some point but we don’t know when. Do we want to be prepared? Perhaps not; because of fear, denial, complacency, and financial self-interest. Is it more expensive to be prepared or not to? Well scientists and economists support that the risk of potentially devastated pandemics could be prevented for a fraction of the cost of battling a deadly global pandemic. Many queries arise with very few and controversial answers. According to the World Bank the cost to the global economy of SARS is estimated to have been $54 billion, while the organization estimates that a ‘severe flu pandemic’ could cost over $3 trillion, nearly five percent of global GDP. Preparing for the pandemic can be expensive as well. The U.K government has spent £424 million ($708 million) on flu drug Tamiflu while global sales of Tamiflu almost reached $3 billion in 2009 (Reuters). So is planning the best defense for a pandemic? But how can we plan before it happens!
Within a month the first industry that was hit hard and seriously affected is “tourism.” Worldwide Tourism and hospitality industry is very badly affecting by pandemics, because of the nature of the business which is always related to the travelling of people. History had shown that epidemics and pandemics have an immediate impact on the hotels and restaurants, airlines industries, travel agencies etc, due to the international travel restrictions, media coverage and government measures. It is only rational that the outbreak has had significant knock-on effects on the Chinese economy as well as the tourism industry worldwide. At the moment, Chinese tourism industry is already ‘lifeless.’ A China tour operator has declared bankruptcy and Chinese tourist enterprises are closing one after the other. So guess, if we have a problem in China, we will most certainly have overflow of this problem on supply chains of manufacture on travel on tourism [and] on other sectors. Take under consideration that Chinese tourists have about 30% higher average per capita spending than other nationalities. Hence, the economic impact will be greater than the proportion of Chinese tourists as a whole. As the spread of coronavirus in Europe is widened, limiting Europeans' disposition for travel, the problem will become even larger for tourism. It is worth noting that in the first two to three months of each year major tour operators make the most of their clients' summer vacation reservations. As expected the countdown begun.
Russian government in panic forbids tour operators to sell in Italy. Coronavirus brought the larger crisis in Italian tourism; with a 40% decrease in its sector (Francesca Brianza, Vice President of Peripheral Lombardy Council). Hundreds of bookings have been cancelled and the future reservations are severely decreased until the end of June. Added to all these, USA has announced a new travel recommendation, the State Department is recommending that Americans who are planning to visit Italy to review their trip (CNN). According to ‘Assotourism’, 90% of all bookings in Rome were cancelled and 80% respectively of Sicily. Tourism industry -representing 13% of the Italian GDP- is sinking. Additionally, Spain businesses are also affected. The impact on the Spanish tourism sector is also expected to be severe. NH Hotels Group and IAG have a powerful presence in Italy. NH Hotels Group has 50 hotels throughout Italy, 12 of which in Milan, while the group's economic activity in Italy reached 290m euro in 2018 (tornosnews). Moreover IAG operates flights to 18 Italian destinations cities affected by the spread of the virus. So it easy to understand the economic impact it will suffer as a result of the pandemic. Noticeably, French Tourism is under attack too; with the prime Minister supporting that they have a decrease of 30-40%. This is an important impact on the French economy if you think that Chinese tourists reach 2.5millions. Obviously, Greek tourism couldn’t avoid not to be affected. The Greek Tourism Minister Harry Theoharis announced few days ago that close to 70 percent of Chinese visitors have cancelled their trip to Greece due to the coronavirus outbreak (Kathimerini). The island of Santorini is already registering a domino of cancelations unfortunately not only from China but from tourists from all over the world, who cancel their trip when they learn that there are Chinese in Santorini. The president of Santorini Hoteliers, Mr. Iliopoulos says that cancellations have reached 60-70% in February and March and will reach 100% in April, as consulates have stopped issuing travel visas. Santorini Travel agents consider that they will lose 10% of this year's tourism revenue, which has a knock-on effect on the entire local economy: trade, transport and services. After the cases of coronavirus in Greece, we are expecting (due to media panic mostly) more cancellations in whole Greece. All tourism businesses hold their breath while observing updates. If the virus keeps on (and especially if this media madness continues) the impact on tourism will be irreversible. World tourism will experience a myriad of global challenges. Amid these are: the possibility of location quarantines, fear to use airports and other centers of mass gatherings, fear of not knowing what to do in case of illness in a foreign land, the need for cross-border medical insurance, etc. Worldwide Hotels (in the countries affected) will lose millions from cancellations, smaller hotels will stop operation simply because they can’t afford it, unemployment will skyrocket, travel agencies and tour operators will bankrupt, transfer companies will be economically destroyed and airfares will rise making traveling impossible even if crisis bypasses. Likewise cruise industry will face a severe crisis given that they are not able to assure eager-to-go-vacationer of their safety when even the WHO seems not to be fully aware of how best to tackle the outbreak of the Coronavirus.
International carriers are not excluded from the catastrophe. The sharp drop in demand will have an impact on all carriers (in particular those operating in the Chinese market). IATA estimates that coronavirus will cause a 4.7% drop in worldwide passenger traffic, and a loss of $ 29.3 billion in passenger revenue. Already 26 airline companies have cancelled their flights from and to many different destinations except China that is the source of the corona virus (Business Insider). Air France declares a loss of 200million, Lufthansa declares “hiring freeze”, cancels renewal with Condor contracts, employees will take unpaid leaves and be offered part time work, and flights will be of course severely decreased or cancelled. KLM as well is taking severe measures that will of course have a severe economic impact. Erik Swelheim said the impact on KLM's revenue would be "very significant." British Airways and EasyJet airlines are cutting flights (to/from Europe) due to costs after demand declines. Specifically, EasyJet freezes hiring, decrease wages, cancels training, and so on. United airlines have also announced cancellation of flights to/from China and other countries as well. On the top of all, Marriott International ceases operation in 90 hotels (in China and Pacific) due to Covid-19 with estimated losses of $ 25 million per month. Also, the ITB exposition in Berlin has been cancelled; a decision that might seem rational but the result will be destructive. Losses are not only for the companies themselves but also for the economy with high unemployment rates, lost GDP, etc.
Every single moment that passes more and more businesses fall apart. While important and experienced scientists worldwide clarify that this virus is similar to other seasonal viruses and with smaller mortality percentages with the only difference that is spread faster (and as all viruses it is dangerous for the elderly whose immune system is low and have more health problems); we stupidly CHOOSE to listen to media garbage and spread panic. It takes very little to destroy a tourism site’s reputation or to panic the public. Look at what happened during the SARS Outbreak in Toronto, Canada’s hotel occupancies had a considerable drop despite the fact that there weren’t any visitors to Toronto with the illness and every possible precaution was taken. Very similar was the case of the Swine flu outbreak in Mexico where visitors just stopped going to Mexico. If we keep following this undercurrent of media spreading panic, tourism and travel industry will be hit doubly hard. At the moment worldwide Media coverage intensifies the virus repercussions and blindly influences decisions being made by governments, companies and travelers. The change and cancellation fees mean a higher degree of travel risk in uncertain times that Covid-19 triggers an already weak European economy into recession. It has already influenced stock markets, with the FTSE 100, the French CAC and the German DAX falling nearly 3% on Thursday 27th and a fall on US stock market and Milan FTSE too (5.3%). Global growth will be surely reduced but the worse is the succession of dreadful decisions, mainly in monetary and/or budgetary matters that will follow.
If only the problem was the people who caught the virus or the falling apart worldwide economy. There are social implications too; a chaos. Asians in Europe have fall victims to alienation and racism (as many accuse them with being virus carriers). While Euro news interviewed a tourist from South Korea, a man in a passing car shouted at him saying he should be wearing a mask. Imagine what will follow; the ones who will carry the virus (Asian or not) will experience racism and stigma. The societies will become a gigantic “lunatic” with unnecessary and unjustified fear and stigma that will paralyze all systems. Local economies will shrink, consumer spending will fall and of course export will be negatively affected. A worldwide overreaction with empty airports, millions of people wearing masks, emptied supermarkets, suspension of operation of schools, churches, and other public institutions, etc. The result will be a shocking financial and economic cost to households, communities, businesses and entire countries. Such a pandemic (and media coverage madness I will add) could cause a global stock market crash that will wipe out the incomes and savings of millions of survivors. As the authors of the Bank of America/Merrill Lynch 2015 Global Pandemics support “{a} severe and prolonged global pandemic could… hit global GDP by as much as 5-10% in the first year.”
Now seat comfortably on your chair and wonder; is there any proven scientific evidence that all these actions-precautions have an effect? Can it REALLY be controlled; provided that this virus/flu is respiratory and easily transmitted so people can be contagious even before they show symptoms? Pointless precautions! Coherently, If one could say that “it could be” prevented the only “unreal” solution would be isolation as it happened with the Hansen’s disease. In 1903, a leper colony was established on Spinalonga Crete Greece, to isolate people suffering from Hansen’s disease from the healthy population. So why didn’t we isolated alike the first carriers of the virus and move them away from healthy population? To continue was the virus made in a lab and let loose by an accident? Well, at the Wuhan Institute of Virology scientists carried out a virus research due to the last coronavirus outbreak, SARS. In a 2017 paper after nearly five years of collecting fecal samples from bats in the Yunnan cave, they had found corona viruses in multiple individuals of four different species of bats. Ms Shi and her colleagues have announced that the genome of that virus is 96 percent identical to the Wuhan virus that has recently been found in humans (David Quammen, The New YORK Times, January 28 2020). In other words, this Wuhan emergency is no novel event but it is a part of sequence related to the past. The lab draw attention in late January, after Chinese scientists said the virus could have a connection “to bats via an intermediary”, for instance a form of game sold at a seafood market in Wuhan. Since the lab has researchers who study bat-related viruses, it easily (maybe not inexcusably) became a target of online suspicion combining all theories and ended up with the assumption that the virus could have escaped from the lab, or was a bio-weapon gone wrong. So when you’re done worrying about this epidemic, worry about the next one. Furthermore, Dr. Li Wenliang had informed others about a bunch of cases of viral pneumonia before the outbreak had been made public, but was bided by Wuhan police for “spreading rumors.” Then, he died by the disease. After that the authorities and experts denied the link of the lab with the disease. Hence, this obvious denial of transparency by the government construes as evidence that something is “hidden” (Jane Li China Tech Reporter, qz.com). To go on with conspiracies allow me to raise another question; was it purposefully created so that pharmaceutical companies will gain from a new vaccine? But how? There is no serious motivation for pharmaceutical companies since there isn’t any commercial market for vaccines until there is an epidemic and after all it takes months and billions to create one. Or maybe by scaring people it is easier and the best way to make money. Was it prophetic what Sylvie Briand, a specialist in infectious diseases at the World Health Organization (WHO), said in a Davos discussion: “We know that it is coming, but we have no way of stopping it?” Further on, could it be part of a plan to eliminate human population? Think about how just one, population growth, guides to a whole set of others. At the moment, the world’s population is now more than 7.5 billion and it is expected to increase by more than 2 billion people by mid-century. Scientists support that possibly more “than half that number will be born in Africa and most of them will be packed into dense urban areas where an epidemic can spread like fire” (the guardian, 2018). Please allow me to bring up here that two years ago a former member of South Africa’s Apartheid-era intelligence service shockingly confessed on camera in a documentary that “the Aids virus and other diseases were deliberately spread among the population in an effort to kill off as many blacks as possible.” He supported that motivation behind it was – “to eradicate black people” – therefore the whites could continue their governance in South Africa (newafricanmagazine, 2019). Perhaps that explains many discrepancies in the story of the expansion of Aids in Southern Africa. Right now, that “world population elimination” picture maybe is not much of “scenario” anymore since it can bring population down to sustainable levels eventually. In reality, and with no hallucinations: The truth, as they say, will out – no matter how long it takes to do so and of course all of the above are speculations and philosophical concerns. However, on the other side there are plenty of evidences that show the impact on the economy, no scenarios for that.
Indisputably, 2020 will be characterized by particular operational, social, economical pressure and pandemonium. Pandemics and economics are linked by more than mere analogy. The financial trouble will spread like a virus too. While I write, the worldwide economy gradually collapses by a virus. When the dust settles we must remember that Covid19 was not a misfortune or science fiction but part of our choices. Keep on your mind: People create crises and people solve the crises!
Philia Tounta MBA, Ba, Di, is General Manager at Apokoros Club Hotel Craft Deco & Activities - Apokoros Villas. Also, Customer Service Manager Thamiris Hotel-Studios-Villa, Travel & Hospitality Consultant-Hotelice, Tourism Ambassador HTS and a freelance writer (ehotelier.com, flashnews.gr, hotelexecutive.com, etravelnews.gr, etc) - Rapporteur.
