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Tourism Sector Could Lose 1.2 Trillion USD Due To Covid-19 Pandemic: UNCTAD Report

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Global tourism set to lose $1-2 trillionOn 1st July 2020, The United Nations Conference on Trade and Development (UNCTAD) published the report, COVID-19 and Tourism: Assessing the Economic Consequences stating that the World Tourism sector could lose around 1.2trillion USD or 1.5% of the Global Gross Domestic Product (GDP) because of the 4months lockdown due to global pandemic situation.

Note:

The assessment on the impacts of COVID-19 on the tourism sector was made using a computable general equilibrium model (GTAP).

Impacts of COVID-19 on Tourism sector:

i.It is estimated that the global loss could rise to USD 2.2 trillion or 2.8% of the world’s GDP if the current situation in international tourism continues for eight months.

ii.A 12 months break in international tourism is estimated to create a loss of 3.3 trillion USD or 4.2% of Global GDP in the worst case scenario.

iii.It is estimated that for every $1 million lost in international tourism revenue, a country’s national income could decline by $2 million to $3 million.

iv.The developing countries are predicted to suffer the steepest GDP losses, in the best case scenario, Jamaica and Thailand could lose 11.0 %  and 9.0 % of GDP respectively and Kenya, Egypt and Malaysia could lose over 3.0% of the tier GDP.

Unemployment:

i.The covid-19 situation induced losses in the supply and service sector of tourism such as food, accommodation and entertainment.

ii.The sudden fall on the tourist arrivals affected the unskilled and skilled labourers.

54% of the jobs in tourism are undertaken by women, which is comparatively higher than the other sectors and the current situation affects these womens due to layoffs in tourism.

iii.In few countries, unemployment could rise more than 20% and some sectors could newly be wiped out if the lockdown extends up to 1 year.

Required Recovery supports:

i.International communities should provide financial support to the most affected countries.

ii.The Governments should provide low interest loans and grants to the organisations like hotels and airlines which facing bankruptcy 

About UNCTAD:
Secretary-General– Mukhisa Kituyi
Headquarters– Geneva, Switzerland