Akdeniz Karpaz University ….
I am writing to share the article written by Amir Khadem of Akdeniz Karpaz University, who is the Dean (A) of the Tourism Department and an Asst. Prof. Dr. of Business Management and we hope your readers will find it to be interesting.
The Consequences of COVID-19 on Tourism and Travel Industry
By Asst. Prof. Dr. Amir Khadem
In recent weeks, we have seen the significant economic impact of the coronavirus on financial markets and vulnerable industries such as manufacturing, tourism, hospitality and travel. Travel and tourism account for 10% of the global GDP and 50 million jobs are at risk worldwide. Global tourism, travel and hospitality companies closing down affects SMEs globally. This, in turn, affects many people, typically the least well-paid and those self-employed or working in informal environments in the gig economy or in part-time work with zero-hours contracts. Some governments have announced economic measures to safeguard jobs, guarantee wages and support the self-employed, but there is a lack of clarity in many countries about how these measures will be implemented and how people will manage a loss of income in the short-term.
The global rating agency said the rapid spread of the coronavirus around the world has led to a deteriorating economic outlook, low oil prices and upheaval in financial markets worldwide, generating an unprecedented credit shock across many sectors around the world.
Although monetary easing by central banks and associated fiscal policy initiatives are expected to help relieve some of the pressures on liquidity, it is anticipated to weigh on the profitability of the financial sector.
COVID-19 may be helping the environment, benefits might only be short term
Restricted travel and stay at home orders are meant to limit the spread of COVID-19. A side effect of that may be a healthier environment outdoors.
With the coronavirus keeping many indoors either from school or work, this means there is less human and vehicular traffic happening around the world.
In the short term, we may see rather immediate benefits to the air quality, but in the long-run, researchers are unable to further the progress of working on innovative tools and renewable energy sources to help the earth.
Demonstrated by NASA satellite, this decrease of carbon dioxide in the atmosphere can be seen globally.
“They have looked at the Chinese cities over the last two months, and compared that with all previous months, the drop is significant and cannot be explained by meteorology or spring break so I think the same thing will be happening again in the US and in Europe, and in other global cities as well,” said Xu.
Similar trends of lower CO2 levels were sighted during the 2008 financial crisis and lasted for a year or two
What are the most worrisome variables for the travel and tourism sector?
Unfortunately, the tourism industry is already vulnerable to many “uncontrollable” factors (the economy, natural disasters, exchange rates etc), and many parts of the world are “over-dependent” on tourism, so the impacts of this crisis will be devastating for many. The small and medium-sized businesses in this sector (and those without deep pockets) are most at risk, as are those who depend on tourism in the most affected parts of the world (e.g. Italy, Spain etc.). Simon Hudson, a professor of tourism in the College of Hospitality believes it will take 6-12 months for travellers to start surfacing, and for many we are looking at a whole summer without business — many businesses will not survive this without government support as it is a low-margin industry.
The industry will recover, but it will take time. When consumers start to “perceive” that it is safe to travel, only then will we see an upturn. Domestic tourism is likely to be the first to recover. There will be plenty of pent-up demand, but travellers will initially be very cautious. Long-haul travel will take longer to recover.
Source: Akdeniz Karpaz University
Who is Assist Prof. Dr.Amir Khadem?
Amir Khadem is an Assist. Prof. Dr. of Business Management at the University of Mediterranean Karpasia. He is the Dean (A) of Tourism Department at University of Mediterranean Karpasia, North Cyprus since September 2016.
He received his Ph.D. degree in business management in the Girne American University received his MBA degree in master of business administration in business and economics Faculty at Eastern Mediterranean University. He lectures on Tourism and hospitality management. He works on Strategic management in the tourism industry.