REBUILDING TOURISM COMPETITIVENESS Tourism response, recovery and resilience to the COVID-19 crisis Markets & Technology Global Tourism Team | July 2020 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 1 Acknowledgements This note was authored by the World Bank Group’s Markets & Technology Global Tourism Team including John Perrottet, Hannah Messerli, Louise Twining-Ward, Shaun Mann, Hermione Nevill, Jessie McComb and Andrew Beath under the guidance of Markets and Technology Practice Manager Martha Licetti, and Global Director for Trade, Investment and Competitiveness Caroline Freund. The team is grateful to technical reviewers who provided insight and guidance at various stages of the production of the note including Mariem Malouche, Kiran Afzal, Tanja Goodwin, Andres Garcia, and Zenaida Hermandez Uriz. Valuable contributions were provided by Emiliano Duch, Wouter Schalken, Jose Miguel Villascusa Cerezo, Jan Kazimierz Orlowski, Ana Cristina Alonso Soria, Gemma Torras Vives, Dennis Sanchez Navarro and Jessica Wilson. The note responds to the COVID-19 crisis that hit the tourism sector in the first quarter of 2020. The crisis is ongoing, so any recommendations made in this report should be considered through the lens of developments that have taken place in the intervening period. 2 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Table of Contents 3 4. POLICY RESPONSES 24 The World Bank Group and Past Crises 27 EXECUTIVE SUMMARY 4 Thinking Forward in the Context 28 1. GLOBAL CONTEXT AND CURRENT IMPACT 6 of Uncertainty Advice for World Bank Clients 29 2. SECTOR IMPACTS AND Phase 1: Immediate Response (during 30 COUNTRY VULNERABILITIES 8 the crisis and early recovery) Sector Impacts 9 Phase 2 Recovery: Short-term 31 Aviation 10 Phase 3 Recovery: Medium-term 32 Accommodation and Lodging 12 5. CLOSING CONSIDERATIONS 34 Tour Operators 12 Cruise Operators 13 Appendix 1: Global Aviation Data 35 Digital Platforms 14 Appendix 2: Regional and Country 38 Global Distribution Systems 14 Vulnerability Data of Tourism: Economic Other Sectors and Impacts on Global Value Chains 14 Dependence and Tourism Resilience Risk Score 3. COUNTRY IMPACTS Appendix 3: Menu of Response Options 39 AND VULNERABILITIES 16 Tourism Dependence 17 Endnotes 44 Tourism Resilience Risk 18 Tourism Demand Impact on Recovery 20 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 3 Executive Summary The travel and tourism industry was one of the first sectors to be affected by COVID-19. Since March, the entire value chain that defines the industry — spanning airlines, bus and train companies, cruise lines, hotels, restaurants, attractions, travel agencies, tour operators, online travel entities, and others — has entered a state of suspended animation. While bankruptcies of major airlines and large tour operators have been widely reported, the effects of the crisis are perhaps being most acutely felt by the Small and Medium-sized Enterprises (SMEs) that make up around 80 percent of licensed tourism and tourism-related businesses, and are at the greatest risk of failure. Their potential collapse threatens to adversely affect millions of people across the world, including many vulnerable communities, who depend on tourism for their livelihoods. According to the World Travel & Tourism Council, as many as 100 million jobs supported by travel and tourism are currently at risk. The COVID-19 pandemic will undoubtedly leave a deep imprint on the structure of the travel and tourism industry. Collapsing consumer demand, low cash reserves, and a lack of access to flexible lines of credit has forced many smaller travel and tourism operators to close. At the same time, while larger firms such as national airlines, tour operators, cruise lines and nationally branded hotel operators are better positioned to withstand the crisis, they are also facing significant challenges as demand is not recovering anytime soon. While some agile players have repurposed their offering, the pandemic is likely to fuel consolidation – and potentially vertical integration – across the sector. While in the short-term there is a risk of widespread discounting to attract visitors to return, in the medium to long-term consolidation may spur price increases and reductions in the range and quality of services. Consequently, the travel and tourism sector that will emerge from the pandemic is likely to be smaller, in terms of both employment and revenue, than it was before. The process of consolidation and vertical integration is also likely to curtail opportunities provided by the sector for operators from developing countries. 4 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS The broader economic impacts of the slump in travel and stakeholders should initially focus on supporting measures to tourism on individual countries and destinations will vary contain the virus and on helping viable businesses to withstand depending on their economic dependence on tourism and the crisis. Potential measures include carefully managing their resilience, as well as the dynamics of demand in their travel restrictions, providing tax rebates and fee waivers, key source markets. The global economic and pandemic and subsidizing training to forestall layoffs. Once the crisis uncertainty is therefore a key limiting factor for both source subsides, stakeholders should focus on building understanding markets and destinations. Countries that are highly dependent of prevailing consumer sentiment and in developing new on tourism include many small island countries, as well as products and modalities appropriate for the post-crisis lower and lower-middle income countries with many people context. For instance, stakeholders may implement periodic employed by travel and tourism. The resilience of destinations surveys to collect data from both providers and consumers, is conditioned by factors such as the local policy environment, expand the access of small-scale providers to digital platforms, public health policies, ICT readiness, government policies for and incentivize training and upskilling. This is also a good time tourism, and the extent of tourist service infrastructure. In this to consider strategic public investments in product upgrades so respect, operators in many developing countries are likely to the destination is positioned for recovery when the time comes. be more vulnerable than operators in developed countries. As the demand for travel and tourism starts to grow again, Finally, countries with substantial domestic tourism markets stakeholders should develop policies and practices that enhance or which can form regional ‘travel bubbles’ are likely to the resilience, and economic and environmental sustainability experience quicker recoveries than those countries dependent of the sector, such as by enhancing the efficiency and equity of on inter-regional markets and particularly those dependent on regulation, investing in inclusive, eco-friendly and community- China, Europe and the U.S. based tourism models, and leveraging technology to enhance regulatory compliance and expand access to market for In responding to the pandemic, governments have employed smaller operators. By taking measures to deepen the positive a range of instruments to support operators in the travel and impacts and minimize adverse consequences, destinations can tourism sector. While some governments have provided support help build back a better travel and tourism sector. to firms across the economy and the tourism sector in general, others have focused policy interventions on specific tourism As the effects of the pandemic unfold, the World Bank Group sub-sectors such as hospitality, food services, hotels, and continues to monitor and advise clients on how to respond airlines. While debt finance appears to be the most popular form to the structural changes that are underway in the tourism of support among governments, other instruments employed sector. These include: include the easing of regulatory burdens, waiving of taxes, • Increasing focus on health and hygiene standards; fees and charges, provision of cash grants and subsidies, and • Understanding how demand is changing (including the employment and training support. Governments should closely role of domestic and regional tourism); monitor the impact of these measures to avoid unintended • Interpreting changing business models due to consequences of support measures in the medium-term. consolidation and corporate restructuring; To both support the containment of COVID-19 and to • Mobilizing innovation and technology solutions facilitate a robust recovery of the tourism sector, this note impacting distribution and market access; and recommends that stakeholders adopt a structured three phase • Guiding public investments in destinations to position approach to addressing the challenges induced by the crisis. them for a more sustainable and resilient tourism While the virus poses a continuing threat to public health, industry post-COVID-19. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 5 1 Global Context and Current Impact The travel and tourism industry was one of the first real sectors to be affected by COVID-19. The crisis has impacted every facet of the industry and demonstrated the vulnerability of the sector’s vast value chain. Since 2000, global travel and tourism revenues have nearly tripled with the sector now contributing 10.4 percent of global Gross Domestic Product (GDP) and providing one out of 10 jobs worldwide. As of mid-April 2020, international travel has ground to a halt. The World Travel and Tourism Council (WTTC) estimates global travel could shrink by more than 30 percent in 2020. According to the United Nation World Tourism Organization (UNWTO), 100 percent of destinations have some level of travel restrictions in place, with 72 percent of countries completely stropping international travel.1 Increasingly, countries are discouraging both international and domestic travel. Latest figures from WTTC show that globally 100 million jobs are at risk in the sector with a potential global loss of up to $2.7 trillion in 2020.2 6 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS The economic crisis triggered by COVID-19 will impact The Cruise Lines International Association (CLIA) estimates large and small businesses alike. Many will not survive that if the order were to remain in effect for a year, the an uncertain timeline without an income and a likely long measures could generate losses of $51 billion and 173,000 recovery period. Zurab Pololikashvili, Secretary-General direct and 343,000 total jobs in the United States alone. of the UNWTO, stressed that “small and medium-sized This is likely to have a significant impact on the $150 enterprises make up around 80 percent of the tourism sector billion global industry. The three major cruise companies and are particularly exposed with millions of livelihoods — Carnival Corporation, Royal Caribbean International, across the world, including within vulnerable communities, and Norwegian Cruise Lines — have already seen a 70 to relying on tourism.” The economic shock could affect small over 80 percent drop in stock prices.7 TUI Group, Europe’s and medium businesses relatively more as they do not have largest package holiday tour operator, and Intrepid Group, the capacity, cash flow, diversity of markets or supply chains, one of the largest adventure tourism companies, have both and resources to mitigate impacts.3 suspended all international package holidays, severely Global businesses across the tourism value chain have paused impacting their business as well as the viability of thousands operations including airlines, accommodation providers, cruise of local SMEs in their supply chains. lines, and tour operators and are already experiencing major Compared to the earlier epidemics, the impact of COVID-19 immediate impacts. A report by CAPA - Centre for Aviation on the tourism sector will be significantly different. While suggests that many airlines will be driven into technical this global pandemic is far greater than the SARS outbreak, bankruptcy by the end of May.4 Air Canada and Qantas there are three other major differences. First, travel has have scheduled the grounding of all international flights with grown rapidly since the early 2000s when SARS hit, with more airlines to follow suit on a daily, if not hourly, basis. international arrivals more than doubling between 2000 and British Airways, Virgin Atlantic, Ryanair, and others, have dramatically scaled back their operations, cancelled routes, 2019. China, a large part of that growth, is now the largest and grounded many planes. Most of the major hotel brands outbound tourism market. Secondly, the emergence of social have withdrawn their 2020 forecasts, with the American Hotel media as a means of sharing information is compounding and Lodging Association estimating that the hotel industry uncertainty and has led to heightened anxiety in relation to in the United States is losing $3.5 billion in revenue weekly travel.8 This is likely to continue into the recovery period. since the beginning of the crisis.5 On April 9, the Centers for Thirdly, the median age of the global population is higher Disease Control and Prevention, the national public health than ever before. This means there is a larger, older population institute of the United States, renewed a no sail order on all that is more at risk. In 2018, for the first time in history, the cruise ships that operate in United States waters. The order number of people over the age of 64 was higher than the will be in place until COVID-19 is no longer an emergency.6 number of children under the age of five.9 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 7 Sector Impacts 2 and Country Vulnerabilities As travel and tourism declines, it will impact both the demand and supply sides, affecting the entire tourism ecosystem. The immediate and severe demand shock of total travel bans and border closures during the crisis has caused a contraction of the industry. In the recovery period, when travel bans are lifted, demand may be slow to recover as the crisis may trigger a global recession with millions losing their jobs and spending abilities. Supply- side effects will vary across the value chain. This will depend on the scale of operations, exposure to more vulnerable demand segments (such as older populations, source markets with the highest economic impact, and others) and the financial strength of individual operators including their ability to weather the impact of substantially reduced cash flow. Countries will also be affected differently depending on their economic dependence on tourism and overall capacity to recover after the crisis. 8 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS The COVID-19 crisis may have long-term impacts on the If, as expected, the pandemic causes a global recession and travel and tourism industry. The industry — spanning airlines, high levels of unemployment, demand for travel and tourism bus and train companies, cruise lines, hotels, restaurants, services will be suppressed by a downturn in disposable attractions, travel agencies, tour operators, online travel entities, income and lower levels of business activity. The crisis is and others — has entered a state of suspended animation due also likely to make consumers more tentative about travel as to the current pandemic. Given the narrow margins and low they will tend to associate travelling and tourism with higher cash reserves that characterize the industry, many companies risks of contracting COVID-19. Against this backdrop, across the subsectors are likely to fail in the absence of external government efforts will be critical to stimulate demand, support to reschedule or defer debt payments and other running enabling the industry to recover. costs, ultimately leading to unemployment. This pandemic may also lead to substantial consolidation of many aspects of the industry. Depending on the nature, scope, and severity Sector Impacts of the pandemic, the economic and psychosocial impacts are likely to curb the demand for travel and tourism services for As a cross-cutting industry, the tourism sector value chain many months — and potentially years — following the crisis. touches almost all aspects of a country’s economy. There are Longer-term effects of the crisis can impact consumer demand several channels through which the impacts will be felt the for travel and tourism services on several levels. These deepest. Figure 1 shows the extensive supply-side channels include broad economic effects and psychosocial impacts. which are being affected. Figure 1. Tourism Product Distribution Channels SUPPLIERS AIRLINE WEBSITE AIRLINE SALES OFFICE/CALL CENTRE TRANSPORT PROVIDER (E.G. AIRLINE, Suppliers to tourism operations, e.g. taxis, food producers, handicraft artisans, CAR RENTAL) GLOBAL DISTRIBUTION SYSTEMS (GDS) INBOUND TOUR WHOLESALE OPERATOR (ITO)/ Advertising and sales TOUR TRAVEL DESTINATION directing to: OPERATOR AGENT MANAGEMENT ONLINE TRAVEL (OFFSHORE) COMPANY (DMC) EBOOKING SYSTEMS HOTEL TOURIST HOTEL SALES OFFICE/ CALL CENTRE HOTEL WEBSITE OTHER TOURISM PRODUCTS AND SERVICES E.G. LOCAL TOURS ATTRACTIONS RESTAURANTS Source: Tourism for Development: Tourism Diagnostic Toolkit (World Bank, 2019). MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 9 The current situation is outlined below along with possible implications for select industries comprising the tourism value chain. Aviation Worldwide passenger flights have fallen precipitously across all regions over the past three months (Figure 2 and Appendix 1). According to an analysis of data provided by FlightRadar24, passenger flights during the week of June 8-15 were a quarter of the volume during the corresponding week in 2019 (year-on-year). International flights have taken the greatest hit. The steepest declines have been registered in Sub-Saharan Africa, Europe and Central Asia, Latin America and the Caribbean, South Asia, North Africa and the Middle East, with North America and East Asia and the Pacific recording shallower – albeit still severe – declines. Figure 2. Change in Total Passenger Flight Arrivals per Region Year-on-year change in weekly passenger flight volume (2019-2020) 160% East Asia & Pacific Europe & Central Asia 140% Latin America & Caribbean Middle East & North Africa 120% North America South Asia 100% Sub-Saharan Africa 80% 60% 40% 20% 0% 1/6 1/13 1/20 1/27 2/3 2/10 2/17 2/24 3/2 3/9 3/16 3/23 3/30 4/6 4/13 4/20 4/27 5/4 5/11 5/18 5/25 6/1 6/8 6/15 Source: ETIMT Analysis using FlightRadar24 Data. Worldwide forward travel bookings have started to pick up in early May, but nonetheless remain at historic lows. As of June 22, scheduled flights worldwide are down 63 percent on a year-on-year basis. The Chinese aviation market has rebounded somewhat, with a drop of 24 percent year on year. Other major markets, such as Spain, Germany, Singapore, France, and the U.K., report decreases in excess of 80 percent.10 The International Air Transport Association (IATA) expects the effects of the crisis to last well into 2021, estimating that passenger air travel, as measured by revenue passenger kilometers, will remain 32-41 percent below expected levels in 2021.11 IATA estimates that, on average, airlines had two months of cash on-hand at the start of this year (Figure 2). This level was already below the three months average level considered to be a reasonable buffer. Airlines in the United States and Europe are facing particularly severe cash flow pressure. Due to the limited extent of cash balances, IATA advises that airlines will “need to draw on credit lines or find other means of support during this crisis period”.12 10 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Figure 3. Airlines’ Balance Sheet Liquidity (Cash and Equivalents Coverage of Revenues*) Min Max Median Months 10 9 8 7 6 5 4 3 2 1 0 Africa Asia Pacific Europe Latin America Middle East North America *Latest available 12 months cumulative revenues at March 2020. Africa, Latin America and the Middle East might not be representative due to small sample size. Source: IATA Economics using the Airline Analyst. While there will be heterogenous effects, analysts estimate – such as catering, maintenance, hotels, and travel agents. that COVID-19 will severely affect the viability of many The aviation industry and those it employs are likely to suffer airlines in the world.13 Vulnerability of airlines to total long-lasting impacts as a result of the pandemic. This could collapse will vary based on a variety of factors. Airlines in lead to a process of consolidation across the industry such as developed countries with excess cash balances or access to occurred in the United States after 9/11 and the 2008 Global discounted rates of credit will be better positioned. Likewise, Financial Crisis (GFC).15 airlines that are state-owned (as is the case with major In the wake of the pandemic, the economic and psychosocial airlines in China and the Middle East), privately-owned ‘flag impacts will potentially suppress demand for aviation for carriers’, or large private airlines with a high proportion of many months. The low level of demand is likely to be partially unionized labor (such as the ‘big three’ in the U.S.), face a offset by cheap operating costs due to low oil prices, a glut relatively high probability of surviving the crisis. Privately- in aircraft due to excess capacity, low costs of financing, and owned airlines, particularly those in developing countries, low labor costs. If external measures to stimulate demand for and budget carriers that operate on narrow margins and are travel services are forthcoming, it is feasible that investments highly dependent on leisure travel, are extremely vulnerable. made by new and existing operators responding to the low Similarly, state-owned carriers in developing countries are in level of operating costs could expedite the industry’s rebound. a precarious position. As of mid-May, airlines that had either However, if external support is not forthcoming and/or if the gone into bankruptcy, administration, or sought protection response in consumer demand is muted, it is feasible that include South African Airways, Avianca, Air Mauritius, the scope of the industry could be significantly smaller in Virgin Australia, and Air Deccan.14 the years following the pandemic than immediately prior to The collapse of individual airlines will, in turn, have damaging the crisis. In those developing countries where governments consequences for jobs and market dynamics across the value lack the capacity to extend financial support to operators, the chain. This will be the case for those employed by companies aviation sector could be substantially smaller in the wake of serving both airlines, airline employees, and airline passengers the crisis than prior to it. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 11 Accommodation and Lodging As the pandemic will lead to bankruptcy and closure of many of the industry’s smaller operators, consolidation of the sector Hotel revenues have collapsed. Marriott, one of the world’s can be expected to occur in the wake of the crisis. In addition largest hotel companies with 1.4 million rooms worldwide, to lower consumer demand, it is likely that price increases has reported that quarterly revenue losses are worse than — following consolidation — in some destinations and those experienced during 9/11 and GFC combined. Quarterly segments could further dampen demand over the medium- revenues are down 75 percent in most markets, compared term. Together, this may result in an appreciably smaller with 25 percent — the largest quarterly drop — in the sector in terms of employment and revenue than before the earlier crises. According to the American Hotel and Lodging pandemic. Association (AHLA), as of April 15, nearly 80 percent of hotel rooms were closed and hotel occupancy rates were Peer-to-Peer (P2P) accommodation will be similarly impacted. below 20 percent.16 In India, large-scale cancellations spiked However, they may recover faster due to lower operating across the corporate, Meetings, Incentives, Conferences and and fewer upfront costs such as debit repayments, salaried Events (MICE), and leisure segments in March. According to employees, marketing expenses, and utilities. In 2017, P2P STR,17 the hotel industry in all world regions had recorded accommodation had approximately seven million beds.21 large double-digit declines in global revenues per available Most of these bookings are made via digital platforms such as Airbnb and Booking.com. Despite generally lower operating room (RevPAR) by March, with Asia (negative 67.8 percent) costs, P2P accommodations are likely to be hit just as hard and Europe (negative 61.7 percent) posting the biggest with cancellations in the short-term as larger commercial decreases. According to a leading industry expert, bookings accommodations. In addition, P2P owners and employees have “dropped off a cliff across the board.”18 lack formal employment protections. However, once the crisis Hotels will not be able to sustain this level of revenue loss is over, this form of accommodation may bounce back faster over time as continuing to operate may risk a hotel’s ability as there are less upfront costs. Further, with the closing or to permanently reopen, with significant impact on job losses. bankruptcy of many commercial properties, a potential room Thus, many hotels will close with immediate job losses. shortage in some markets may lead to higher-than-normal One operator in the United States with 13,000 rooms has occupancies in P2P properties. For example, in St. Maarten, laid off over half of its 8,000 employees and had planned to following Hurricane Irma, when most commercial properties lay off a further 2,000 by the end of April. Based on current were not usable, P2P accommodation grew both formally occupancy estimates, AHLA estimates that a total of four and informally. With this in mind, governments with policies million jobs have either already been eliminated across the against such private lodging entities may need to consider United States or will be lost by the end of May. While data temporary exemptions to enable legal growth of this largely on job losses are more scarce for emerging economies, STR undocumented sector. notes that Colombia, Argentina, and Brazil are the three Latin American countries most affected by COVID-19 with Tour Operators occupancy rates declining by 74 percent to 93 percent on the As travel demand declines, tour operators globally are going week of March 30, 2020.19 In Bogota alone, daily occupancy through an unprecedented stress test. Most tour operators rates dropped from 78 percent on February 19 to 3.9 percent have developed relaxed booking policies to encourage on March 29. future holiday bookings during the COVID-19 crisis. The hospitality industry is already facing widespread closures, Tour operators including Kuoni, Hayes & Jarvis, Prestige, bankruptcies, and layoffs, and the situation is likely to G Adventures, i-escape, On Foot Holidays, and Camino Ways worsen in the coming months. Widespread redundancies can are among those waiving fees if clients want to change travel be expected among employees of hotels and other hospitality destinations or trip dates. As commercial airlines ground service providers unless wage subsidies, blanket moratoriums more flights and countries close borders to outbound and or deferment of debt payments, and tax holidays can be inbound travel, bookings will go down to zero. instituted quickly. Tourism and hospitality investors may Given that small and medium enterprises make up 80 percent also incur large losses.20 Operators, who are unable to access of the industry, the worst-affected tour operators will be the flexible lines of credit and/or other forms of support, will be smaller companies operating in more vulnerable emerging particularly vulnerable to bankruptcy and closure. Small- and economies where international long-haul travel is a significant medium operators, which dominate the hospitality sector in market segment. Below is an example from a tour operator in many developing countries, will be especially hard hit. Tanzania, handling roughly 30,000 passengers per annum:22 12 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Box 1. Example of COVID-19 Impact on a Tour Operator the Grand Princess cruise ship off the coast of California; and at in Africa least 25 additional cruise ships leading to 800 confirmed cases among passengers and crew.25 With a high passenger density — • We expect to lose 27 percent in the first three months, the largest ship, Symphony of the Seas, carries 6,680 passengers stretching to 66 percent after 6 months. — the cruise sector is particularly at risk for the spread of • The key months will be July and August. If travel does COVID-19. Further, it brings together diverse markets from not restart by then, the consequences will be ultimately around the world, and a high percentage of the market is older terminal for all but a few operators. adults over the age of 65, who are at higher risk. • The VAT cost to government is 18 percent of revenue. • It is difficult to predict the park fee and concession fee The Cruise Lines International Association, representing 50 revenue for the government but it is around 10 percent cruise lines, took the first step and announced a temporary of our revenue plus the associated VAT. suspension all cruise operations at least till the end of May. • Our best-case scenario is a six-month wage cut, which This was shortly followed by the United States Center for amounts to US$500,000, with associated loss of Disease Control no sail order announcement for all cruise government taxation of around US$230,000. ships over 250 passengers until further notice.26 While the • We are likely to incur job losses of over 20 percent if dates vary with each company, only a few estimate resuming travel picks up before August and 50 percent if it is post- operations in June — Carnival Corporation (August 1), Royal August. Caribbean Cruises (June 12 at the earliest), MSC Cruises (July • Supplier costs would fall in line with our revenue as 10), Viking Cruises (June 30) and Norwegian Cruise Lines Gross Profit is relatively consistent and KPIs are driven (June 30) – and even these dates are tentative. Companies are by the number of passengers. taking different approaches to staff layoffs during this time. • Guides and small safari operators who rely on seasonal Viking Cruises and Disney Cruises will continue to compensate work would lose out to in-house guides on payroll. both shoreside staff and crew for a few months; Princess • Associated industries such as vehicle workshops, office Cruises maintained shoreside employees while shipboard crew support services, town transfers, and local single-family were sent home.27 Since approximately one third of all cruise businesses would fall as Arusha is the safari capital. employees worldwide are from the Philippines, employment loss will have a disproportionate impact on the country.28 The three major cruise companies — Carnival Corporation, Cruise Operators Royal Caribbean International, and Norwegian Cruise The cruise sector is dominated by three global companies Lines — have already seen major drops in stock prices with — Carnival Corporation, Royal Caribbean Cruises, and Norwegian Cruise Lines experiencing around an 80 percent Norwegian Cruise Line — that own 18 of the world’s cruise drop since the beginning of the year. The negative shock on line brands. In 2018, the cruise sector provided 1.177 million stock prices, reputational damage caused by COVID-19, and jobs equating to $50.24 billion in wages and salaries and $150 registration under foreign flags will impact the ability of cruise billion in total output worldwide. Cruising has been growing companies to mobilize capital in the short-term to cover costs. rapidly with cruise lines investing in bigger ships, reaching In March, Carnival Corporate had an active cash burn of $500 capacities never before handled. As forecasted by Cruise Lines million per month and required an injection of $6 billion to International Association, 32 million passengers were scheduled weather the crisis. With its headquarters in the United States, Carnival’s ships, like most other major cruise ships, sail under to travel on 278 cruise line ocean ships in 2020. Regionally, foreign flags in tax haven countries with weaker employment the Caribbean and Mediterranean see the highest percentage rules. This has excluded them from the United States stimulus of cruises with 32 percent and 17 percent of all cruise line package. Instead, they will be looking to mobilize capital deployments, respectively.23 In some countries, the cruise sector through secured notes, convertible notes, and issuance of new is a major contributor to the economy and the foundation of shares.29 While no reliable forecasts on the long-term impact of the tourism sector. Some countries in the Pacific are particularly the crisis on the cruise sector are available, it may fuel further dependent on the cruise sector, like Vanuatu that received $34.6 consolidation in the sector, an existing trend over the last two million in direct economic impact in 2014.24 decades. Alternatively, it could lead to increasing market share Cruise lines have been at the frontline of the COVID-19 crisis for smaller ships, which offer higher quality and lower density playing an inadvertent role in the global spread of the pandemic. cruises. In the short-term, discussions on supporting the Between February and March 2020, there were major industry highlight how this crisis provides an opportunity to outbreaks on multiple cruise ships: The Diamond Princess, increase the sector’s environmental sustainability and support which was quarantined in the port of Yokohama, Japan; more sustainable labor practices. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 13 Digital Platforms Global Distribution Systems Bookings across the tourism sector are driven by technology A handful of companies are the foundation of booking platforms including those that service travel agents such as management for travel agents globally. Sabre, Amadeus, global distribution systems (Sabre, Amadeus, Galileo), and Galileo, and Apollo are Global Distribution Systems (GDS). those that cater to independent travelers booking directly These reservation systems serve as marketplaces for travel (Booking.com, TripAdvisor, Airbnb, Expedia, Travelocity). agents to reserve airlines, hotels, and other travel services. Prior to the crisis, Online Travel Agencies (OTAs) represented They act as a global inventory management and reservation 39 percent of the United States’ online travel market and were system. While most travelers never interface with these growing exponentially. TripAdvisor alone was responsible businesses, they are a critical element of any booking made for $546 billion (10.3 percent) of global tourism spend. An through a travel agent or tour operator. As an indication of increase in TripAdvisor reviews is often followed by a higher the impact on GDS, Sabre plans to make $200 million in tourism demand.30 cost reductions this year including a temporary reduction Three main business models predominate among OTAs, in pay for US-based salaried workforce, CEO pay cut, and increasing their resilience. The bulk of TripAdvisor revenues a reduction of benefits, among other actions. Additionally, are based on advertising and a pay-per-click revenue model. the company will suspend the payment of quarterly cash Booking.com (owned by the Priceline Group), on the other dividends on common stock.33 hand, is driven largely by a commission model, while Expedia mainly buys services in advance and in bulk before selling Other Sectors and Impacts on Global Value Chains them to consumers. While companies like Priceline and The impact of disruptions caused by COVID-19 in the tourism Expedia are well capitalized and likely to recover more and travel industry goes well beyond the sector, affecting many quickly, They have suffered large losses and there have been other Global Value Chains (GVCs). The more obvious are the substantial losses of jobs.31 Most OTAs have withdrawn their suppliers to the industry — food services, furniture suppliers, 2020 forecasts and Expedia expects the negative impact to property management services, and event organizers. As an be $30-40 million or higher in the first quarter of 2020.32 example, the cancellation of the Mobile World Congress The recovery of these digital platforms will be important for in Barcelona in February had an estimated loss of €479 tourism SMEs, which rely on OTAs and digital distribution million and 14,000 jobs, covering diverse areas including channels as a key part of their business models. architects, ICT, audiovisual, and logistics.34 The impact has OTAs by their nature are more agile in responding to been significant on the restaurant industry as well. Globally, emerging data and shifting supply. They will be faster to restaurants started to record a decline in reservations in late bounce back compared to stuck-in-place service providers February, plummeting to zero by mid-March. There has been constrained by their locational circumstances. Brand and some recovery in recent weeks reflecting divergent reopening brand loyalty are the primary concerns of these OTAs as they policies across countries. While some restaurants have been navigate the crisis. They want to retain customers as well as able to shift their operations to takeout and delivery models, be the platform of choice post-crisis. the impact on the industry is severe. Figure 4. Restaurant Reservations – Decline in Year-on-year Reservations Global United Kingdom United States 20 % year-on-year change 0 -20 -40 -60 -80 -100 ay ar ay ar ay b ar r ar b r ay r n ar r n n Ap Ap Ap Fe Fe Ap Ju M M M M M Ju M Ju M M M 16 28 25 14 18 24 21 10 26 5 2 17 31 19 7 12 3 5 Source: ETIMT Analysis using OpenTable database. 14 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS The declining demand is also affecting the transport industry GVCs, especially aircraft and automotive supplies. The aircraft industry is ending its 16-year surge (since the end of SARS). Many airlines including Cathay and Norwegian have put their orders on hold, shares for Boeing and Airbus have fallen to 1987 levels, and Boeing has drawn a $13.8 billion loan to face the crisis.35 In the automotive industry, the motor-coach industry has dropped radically — between 60 percent for scheduled and 95 percent for charter in the United States36 — affecting producers of the buses. These drops in demand are independent of the fact that many are closing their plants due to supply chain disruptions or quarantine requirements. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 15 3 Country Impacts and Vulnerabilities The question of which countries will be the hardest hit, and which will recover first is critical for response planning. While all countries will be impacted by the COVID-19 crisis, the extent of that impact will depend on i) the degree of dependence of the country’s economy on tourism and tourism-related services and suppliers; ii) the supply-side resilience of the country -- its ability to respond and recover from the crisis; and iii) the demand dynamics - resilience of the country’s key tourism source markets. Accordingly, the M&T Global Tourism Team has conducted analysis on the first two of these areas: dependency and resilience. The purpose of these analyses is to identify which regions and countries are likely to be the hardest hit by a decline in travel and tourism and which are likely to find it hardest to recover and may need more support. The dependency analysis uses 2019 World Travel and Tourism Council (WTTC)37 data on the total contribution of travel and tourism to GDP and to employment, with data for 177 countries. Supply-side tourism resiliency is assessed using 45 indicators from the 2019 World Economic Forum Travel and Tourism Competitiveness Index (WEF TTCI).38 For demand-side resilience, there are still high levels of uncertainty given that the timeline for travel demand recovery will likely be driven by advances in medicine and healthcare-related policies. However, a key issue to note is that uncertainty is a constant in both supply and demand sides, creating a complex situation in which agility and availability of data is critically important. 16 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Tourism Dependence Over 40 percent of countries relied on travel and tourism for more than 10 percent of their GDP and employment in 2019 according to WTTC. • There are 76 countries with more than 10 percent of their GDP from travel and tourism; 19 of these are low and lower-middle income countries. • Globally, the countries that most rely on travel and tourism are the small island countries (by GDP in 2019). There are 16 small island countries with more than 30 percent of their GDP from travel and tourism: Antigua and Barbuda, Aruba, the Bahamas, Barbados, Belize,39 British Virgin Islands, Cabo Verde, Dominica, Fiji, Grenada, Jamaica, Macao, the Maldives, Seychelles, St. Lucia, and Vanuatu. • In terms of employment, the patterns are similar. In 79 countries, more than 10 percent of employment is attributed to tourism; 17 of these are low or lower-income countries. The table that follows shows all 177 countries in the WTTC GDP dataset categorized by their degree of economic dependence on tourism (see Appendix 2 for further details). The results are divided into four categories of dependence: severe, high, medium, and low. Regionally, Latin America and particularly the Caribbean, Europe and Central Asia, East Asia and the Pacific have the highest number of severely tourism dependent countries. While these countries’ economies will be most impacted by COVID-19, the economic impact on small islands, across all regions, is likely to be the worst because of low economic diversification of their economies. Table 1. Tourism Dependency by Tourism contribution to GDP, WTTC 2019 (country names) Region Severe = ≥20% GDP High = 10-20% GDP Medium = 5-9% GDP Low = ≤5% GDP in tourism in tourism in tourism in tourism East Asia Cambodia, Fiji, Macao SAR, Australia, China, Hong Brunei Darussalam, Indonesia, Japan, Rep. of Korea, Papua & the Philippines, Vanuatu Kong SAR, Malaysia, Vietnam, Lao PDR, Mongolia New Guinea, Myanmar Pacific New Zealand, Singapore, Solomon Islands, Tonga, Thailand, Kiribati Europe & Albania, Croatia, Georgia, Greece, Armenia, Austria, Azerbaijan, Belarus, Bosnia and Belgium, Ireland, Central Iceland, Montenegro Bulgaria, Cyprus, Herzegovina, Czech Republic, Denmark, Poland, Russia, Poland, Asia Estonia, Italy, Portugal, Finland, France, Germany, Hungary, Uzbekistan Slovenia, Spain, Turkey Kyrgyz Republic, Ireland, Kazakhstan, Latvia, Lithuania, Luxembourg, Moldova, North Macedonia, Netherlands, Norway, Romania, Serbia, Slovak Republic, Sweden, Switzerland, Tajikistan, Ukraine, United Kingdom, Latin Antigua and Barbuda, Aruba, Chile, Costa Rica, Cuba, Argentina, Bolivia, Brazil, Ecuador, Colombia, Guyana America Bahamas, The, Barbados, Belize, Dominican Republic, Guatemala, Haiti, Peru, Trinidad and Paraguay, Puerto Rico, & the British Virgin Islands, Cayman El Salvador, Honduras, Tobago, Venezuela Suriname Caribbean Islands, Dominica, Grenada, Jamaica, Mexico, Nicaragua, St. Kitts and Nevis, St. Lucia, St. Panama, Uruguay Vincent and the Grenadines Middle Bahrain, Jordan, Malta, Algeria, Egypt Arab Rep., Iran Libya East & Lebanon, Morocco, Islamic Rep., Iraq, Israel, Kuwait, North Tunisia, United Arab Oman, Qatar, Saudi Arabia, Syrian Africa Emirates Arab Republic, Yemen Rep. North Bermuda Canada, United States America South Asia Maldives Sri Lanka India, Nepal, Pakistan Bangladesh Sub- Cabo Verde, Sao Tome and Botswana, Comoros, Cote Benin, Cameroon, Central African Angola, Burkina Faso, Saharan Principe, Seychelles d'Ivoire, The Gambia, Republic, Ethiopia, Ghana, Kenya, Burundi, Chad, Congo Africa Lesotho, Madagascar, Malawi, Mali, Mozambique, Niger, Dem. Rep., Congo Mauritius, Namibia, Senegal, South Africa, Sudan, Eswatini, Rep., Gabon, Guinea, Rwanda, Tanzania Togo, Uganda, Zambia, Zimbabwe Nigeria, Sierra Leone Notes: Shading indicates countries most heavily dependent on tourism. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 17 While generally tourism’s contribution to GDP and to use) as digital engagement is likely to be a key factor to total employment is correlated, there are some countries get tourism SMEs back in operation. that rely heavily on tourism for job creation, despite a • Prioritization of travel and tourism by government. lower contribution of tourism to GDP. In these cases, Includes six indicators that demonstrate government overall impact from a reduction in travel and tourism may spending and management of tourism including not be immediately obvious but will be felt later as those availability of data and brand strategy. Countries that employed in the sector lose their jobs. Among lower and prioritize tourism, communication, and marketing will lower-middle income countries, Lao PDR, Mongolia and recover faster. Indonesia fall into the medium dependency category based • International openness. Assesses visa regulations, air on tourism’s contribution to GDP; however, they are in the transport agreements, and trade agreements. While high dependency category based on tourism’s contribution to recovering from a crisis, countries with more open entry employment. Similarly, Philippines has high GDP dependency requirements will have an advantage. and severe employment dependency. This may be driven by • Air transport. Includes six indicators that show seat lower value tourism in these countries, but a high dependency capacity, number of airlines, and quality of airline on the sector for low skilled job creation. A much larger connections. A diversity of market and air route number of upper-middle and high income countries have connections will aide recovery significantly. higher dependency on tourism for employment than for • Tourist service infrastructure. Includes indicators on the contribution to GDP due to their more diversified economies, quality of tourism facilities and services. Destinations with but higher reliance on the service sector for jobs. high-quality tourism infrastructure and services are likely to recover sooner, as they will be able to tap into high-end Tourism Resilience Risk traveler markets that may be the first to travel again. Like the WEF index40 itself, the tourism resilience score was Tourism resilience is a factor of both supply and demand-side calculated as the mean score across the seven unweighted variables. However, given the uncertainty of post-COVID-19 WEF pillars41 to create a Tourism Resilience Risk (TRR) or tourism demand, this tourism resilience model takes a vulnerability score. The score was inverted so higher scores supply side approach using existing data from 135 countries indicate higher resilience risk. This score was then plotted compiled by the World Economic Forum’s Travel and Tourism against the total tourism contribution to GDP to identify Competitiveness Index (WEF TTCI). The WEF TTCI includes which countries’ tourism sectors are most at risk and are 90 indicators organized into 14 pillars. This model uses just most likely to need priority tourism support in response to 45 of these indicators in seven pillars. These include: the COVID-19 crisis. • Policy environment for business. Includes 12 indicators As with the dependency analysis, the results are divided to assess if a country’s policy environment is conducive into four categories: severe, high, medium, and low. ‘Severe for companies to do business. A strong enabling risk’ countries are those with the highest GDP and highest environment is critical for fast business recovery and TRR score, ‘low risk’ countries are those with the lowest attracting new investment with the onset of recovery. GDP dependency and lowest TRR score. Figure 5 shows the • Health and hygiene. Includes six indicators of health and results for low and lower-middle income countries based on hygiene that are essential for COVID-19 recovery, such this supply side analysis. It should be noted that WEF data do as the number of hospital beds and physician density. not cover most small island countries in the Caribbean and • ICT readiness. Includes eight indicators (for example, South Pacific. A separate rating for small island countries is mobile subscriptions, mobile network coverage, internet in progress. 18 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Figure 5. Low and Lower-Middle Income Countries by Combined Tourism Resilience Risk and Dependency Rating 6.00 Congo, Dem. Rep. Chad Tourism Resilience Risk Score - see note Burundi Yemen, Rep. 5.50 Malawi Burkina Faso Cameroon Angola Guinea Mozambique Sierra Leone Mali Nigeria Ethiopia Haiti 5.00 Benin Uganda Zambia Cote d’Ivoire Zimbabwe Lesotho Bangladesh Pakistan Ghana Tanzania Tajikistan Rwanda Gambia, The Senegal Dependency (GDP) 4.50 Bolivia Nepal Kenya Kyrgyz Republic Severe: ≥20% Nicaragua Cambodia Mongolia Lao PDR High: 10% to <20% Moldova Honduras Egypt El Salvador Medium: 5% to <10% 4.00 India Vietnam Tunisia Low: ≤5% Philippines Morocco Ukraine Severe Resilience (WEF) Indonesia 3.50 Severe: ≥3.5 High: 3 to <3.5 High Medium: 2.5 to <3 3.00 Low: 1 to <2.5 0 5 10 15 20 25 30 Tourism Contribution of Travel and Tourism to GDP East Asia & Pacific Europe & Central Asia Latin America & Caribbean Middle East & North Africa South Asia Sub-Saharan Africa Note: Tourism Resilience Risk score is the mean score across seven WEF pillars inverted to identify those with the highest tourism resilience risk scores against those with the highest GDP scores, i.e. a score of 1= lowest tourism resilience risk and a score of 7= highest tourism resilience risk. To facilitate readability, axis was restricted to 2 to 6. Photo: © John Mackedon / World Bank MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 19 Figure 6 shows the upper-middle and high-income countries that are likely to have the most difficulty recovering (high/severe GDP and severe/high tourism resilience risk) based on this analysis. Figure 6. Higher-middle and High-income Countries by Combined Resilience Risk and Dependency Rating 5.00 Venezuela, RB Algeria Tourism Resilience Risk Score - see note 4.50 Iran, Islamic Rep. Botswana Paraguay Bosnia and Herzegovina Guatemala Macedonia, FYR Kuwait Sri Lanka Namibia Albania 4.00 Ecuador South Africa Kazakhstan Brazil Lebanon Colombia Azaerbaijan Serbia Brunei Darussalam Trinidad and Tobago Jordan Severe Argentina Slovak Republic Oman Peru Armenia Dominican Republic Dependency (GDP) 3.50 Romania China Jamaica Russian Federation Saudi Arabia Uruguay Montenegro Severe: ≥20% Georgia Poland Slovenia ChileBahrain Mexico High: 10% to <20% Lithuania Latvia Hungary Turkey Panama Mauritius High Medium: 5% to <10% Israel Qatar Bulgaria Costa Rica Czech Malaysia Estonia Croatia Thailand Low: ≤5% 3.00 Belgium Republic United Arab Italy Denmark Sweden Emirates Cyprus Greece Ireland France Resilience (WEF) Korea, Rep. Finland Malta Medium Luxembourg Severe: ≥3.5 Netherlands Norway United Kingdom Portugal Austria Spain High: 3 to <3.5 2.50 Japan Hong Kong SAR, China Germany Iceland Medium: 2.5 to <3 Australia New Zealand Switzerland Singapore Low: 1 to <2.5 Low 2.00 0 5 10 15 20 25 30 35 Tourism Contribution of Travel and Tourism to GDP East Asia & Pacific Europe & Central Asia Latin America & Caribbean Middle East & North Africa South Asia Sub-Saharan Africa Note: Tourism Resilience Risk score is the mean score across seven WEF pillars inverted to identify those with the highest tourism resilience risk scores against those with the highest GDP scores, i.e. a score of 1= lowest tourism resilience risk and a score of 7= highest tourism resilience risk. To facilitate readability, axis was restricted to 2 to 5. It should be noted that this analysis is based on historical Those heavily dependent on the source markets most impacted supply-side data which does not include market demand, fiscal by COVID-19 infections will impacted more severely. While or macroeconomic factors. In some countries, international constantly changing, as of mid-May, the top ten countries tourism is a key source of foreign exchange. The sudden with the most COVID-19 cases were: United States, Spain, and almost complete loss of foreign income can place severe Russia, United Kingdom, Italy, France, Germany, Brazil, constraints on a country’s ability to purchase foreign goods and Turkey and Iran. High infection rates mean that these services. When assessing overall resilience risk for a country or countries may have longer travel restriction periods imposed destination, it will be necessary to incorporate an assessment of by both their own countries and inbound destinations, as these factors including the scale, nature and origin of demand. well as airlines and other transport providers. While China The following section examines demand side factors such as the had one of the highest rates of infection early on, it is now in size of the domestic and intra-regional tourism market which the recovery stage and regional destinations may be able to are likely to be associated with swifter recovery. tap into this market when travel is safe again (Figure 7). On the other hand, the United States continues to struggle, facing Tourism Demand Impact on Recovery challenge from the pandemic and subsequent economic crisis. Destinations that are reliant on the United States market, like Destinations are dependent on different source markets the Caribbean, may need to consider market diversification based on their geographic locations, access and products. in the short-term (Figure 8). 20 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Figure 7. Chinese Outbound Tourism Flows 2018 (%) Sub-Saharan Africa 0.5 Middle East & North Africa 4.0 North America 5.8 Latin America 0.4 Caribbean 0.1 South Asia 1.5 Australia, New Zealand & Pacific 3.4 East Asia 20.4 China 100.0 South East Asia 44.2 Europe & Central Asia 19.7 *Excluding Hong Kong, Macao and Taiwan. Figure 8. United States Outbound Tourism Flows 2018 (%) Sub-Saharan Africa 1.4 Middle East & North Africa 4.6 Latin America 9.3 Caribbean 16.1 South Asia 2.3 Australia, New Zealand & Pacific 2.0 East Asia 9.7 USA 100.0 South East Asia 6.1 Europe & Central Asia 48.5 *Excluding Mexico and Canada. Additional demand-side resilience assessments could include, for example: • The size and value of the domestic tourism market as domestic tourists are regarded as likely to travel sooner than international visitors. Countries with a higher value domestic tourism market are likely to recover their tourism sectors faster. • The size of the intra-regional markets may indicate the potential for regional recovery between closely-related safe-zones or regional ‘travel bubbles’ (e.g. ‘Tasman bubble’ between Australia and New Zealand). • The number of COVID-19 cases in the country and the number in neighboring countries will impact the length of lockdowns and travel restrictions and the ability to get domestic and intra-regional travel restarted. Although all the resilience data included here is limited to country-level, it should be noted that there will be large differences within countries dependent on both supply and demand factors. Any use of the above data for decision making should therefore be supported by additional destination-specific data points. The geospatial aspects of tourism resilience risk are important as they are likely to heavily impact vulnerable populations such as women and indigenous communities who tend to have fewer financial resources to withstand crisis. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 21 22 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 23 4 Policy Responses Globally, tourism policy makers are responding in different ways. However, most of them agree on the need for two distinct phases of intervention — immediate response and recovery. The first relates to interventions (including policy) that respond to the immediate crisis. This implies the abrupt removal of almost all forms of tourism demand for an unspecified time and the corresponding shock to the industry. The second phase refers to the preliminary, followed by longer-term measures, to help the sector recover once signs of imminent recovery are identified. Policy interventions in the first phase focus on survival and support the private sector to maintain workforce. In the second phase, they focus on sector-wide reinvention, recovery, and building resilience. 24 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Policy interventions in more advanced economies are being information on policy responses targeted to airline firms, rolled out to support the tourism sector at speed and scale. please refer to: ‘Support to systematically large firms in hard- In developing economies, interventions are likely to follow hit sectors: The case of airlines state-support programs amid a similar pattern, but with fewer resources and lesser COVID-19’.42 FCI’s Markets & Technology Global Unit capacity to implement them. Consequently, the sector’s most had identified 205 individual policy responses in the tourism effective responses are likely to emerge from multiple actors sector as of June 2020.43 — government, other stakeholders, and private sector — High-income countries have deployed most of the identified working together. interventions. As of June 2020, high income countries had Policy responses include measures to support travel and deployed 58 percent of the identified interventions, with tourism as a whole, as well as those targeted at specific sub- the balance composed by lower-middle income (17 percent) sectors. Measures include direct financial support to alleviate and upper-middle income (25 percent) countries (Figure 9). debt obligations, cash grants and subsidies, employment and Countries in Europe and Central Asia have deployed the training support, easing of regulatory burdens and waiving largest share (36 percent) of the identified interventions, of fees and charges. In addition to economy-wide and sector- followed by East Asia and the Pacific (22 percent) and Latin wide support, some policy interventions have been designed America and the Caribbean (13 percent) (Figure 10). Among to support specific sub-sectors including hospitality, food individual countries, the United States has, however, deployed services, hotels and transport. Several specific interventions the largest number of identified interventions, followed by have been targeted at the aviation sector. For further Australia (Figure 11). Figure 9. Number of Measures by Income-Level Figure 10. Number of Measures by Region 5% 11% 25% 36% 13% 58% 17% 13% 22% High income Upper middle income Europe & Central Asia Middle East & North Africa Lower middle income East Asia & Pacific North America Latin America & Caribbean Sub-Saharan Africa Figure 11. Number of Measures by Country 1 7 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 25 Figure 12. Number of Measures by Sub-Sector Tourism-wide interventions are more common than those targeting sub-sectors and debt financing is the most popular 3% 1% instrument of measures tracked. Tourism-wide interventions comprise two-thirds of the identified interventions, followed 11% by aviation-specific interventions (18 percent) and food service and hotel interventions (11 percent) (Figure 12). Debt finance is the most frequent type of intervention, followed 18% 67% by tax-related measures, and investment/capital-related measures (Figure 13). High-income countries appear to be relatively more likely to deploy debt finance measures and less likely to deploy tax-related measures (Figure 14). Measures in lower-middle-income countries have focused predominantly Tourism-wide Hospitality on debt finance and tax-related interventions, while those in Aviation Transport upper-middle income countries have been relatively balanced across different types of interventions. Food services and hotels Figure 13. Number of Measures by Type Debt finance 29 Tax 15 Business costs 7 Investment/capital 6 Type of Support Employment support 5 Support to demand 5 Other finance 4 Business climate 1 Regulations 1 0 5 10 15 20 25 30 35 Number of Measures Figure 14. Type of Measures by Income-Level 16% 21% 7% 38% 4% 11% 11% 5% 4% 8% 5% 8% 16% 8% 42% 26% 38% 11% 11% High Income Lower Middle Income Upper Middle Income Business climate Business upgrading Employment support Other finance Support to demand Business costs Debt finance Investment/capital Regulations Tax 26 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Some further examples of policy responses are shown in the table below. Table 2. Examples of Support Measures and Policy Responses to COVID-19 Croatia South Peru Canada Singapore Indonesia Fiji Rwanda Kazakhstan Sri Lanka Africa Cash grants/subsidies       Tax rebates/relief         Loan repayment          support/credit support Training incentivization   Rules alleviation      Fees/bills waivers   Source: IMF COVID-19 Policy Tracker. The World Bank Group and Past Crises • Being selective and focusing on additionality.44 Support is stronger with selective coverage and focus on the World Bank’s comparative strengths (for example, fiscal The COVID-19 crisis — in terms of scale, scope, and trajectory — has impacted the tourism sector in a way none and public expenditure policies). of the earlier crises have affected the sector. In the past, • Considering the poverty angle, inclusion and despite disasters (SARS, Ebola, the 2008 GFC, H1N1), policy distributional impact. It is vital to attend to poverty makers were able to plough through the crisis period and dimensions from the onset of a crisis, and not only in plan for recovery based on a likely end date. its later stages. Customizing policy advice to the country context is as important as ensuring its technical quality. In this case, the uncertain cycle and global nature of the • Monitoring impact. Support during crises is more pandemic puts the industry in a unique situation especially successful when nested in a results framework (explicit because an end date is harder to predict. Further, the or implicit) that incorporates post-crisis recovery. pervasiveness of the virus leaves few options for travelers and • Using agile financing modalities and organizational operators. The ‘immediate response’ period before ‘recovery’ is arrangements. Programmatic Development Policy Loans the immediate concern. This means that policy responses must can be fast-tracked to address crisis needs more easily be designed to deal with the immediate survival of the industry in 2020. Support should be conditional to maintaining than Investment Project Financing. Also, additional workers, and if support is provided to large firms, it should be instruments may be needed for initial liquidity support conditional to paying vendors and avoiding massive layoffs. as part of multipartner packages. Internal organizational The same rules should apply to those that are considered arrangements can make a big difference as they affect strategic firms because of their input-output linkages. the degree of preparedness, cross-sectoral coordination, timeliness of response, and appropriateness of Also, policy responses must be designed to support recovery instruments — all of which help get results. and growth once travel bans are lifted and the market has • Coordinating with partners. Collaboration across the the ability and desire to travel again. The World Bank Group WBG and with outside partners, including industry, (WBG) has supported client countries through diverse crises. strengthens program effectiveness and is essential to Key lessons include: exploit synergies, avoid overlaps, and maximize impact. • Emphasizing quality and maintaining focus. The speed and quality of bank response are crucial for positive outcomes during and after crises. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 27 Thinking Forward in the Context 1. Tourism recovery will be uneven. The recovery process will be at a varied pace and scale in regions, countries, of Uncertainty and destinations. Destinations that understand their markets in terms of investments, services, and marketing Historically, demand is known to rebound after a crisis, campaigns required to attract customers, will be more although the recovery time and the recovery profile varies. successful. This may mean investing in regulation and Analysis by McKinsey45 shows that after SARS (2003) and policy to open air routes, increasing visa openness, supporting P2P accommodation, increasing health and MERS (2015), it took between three and five months to hygiene in hotels, and others. recover to pre-crisis levels of demand. Air passenger volume had a steeper and longer-term drop post-9/11, and the GFC 2. Demand for particular tourism products/segments may be recovered to 90 percent of original demand levels within 10 reshaped leading to new forms. While it is unclear which months. After the GFC, airlines moved to lower prices to spur products and segments will be impacted, it is likely that demand and accelerate recovery. However, the financial crisis the market will seek different types of experiences. Initial had a longer and larger impact on hotels, taking them years surveys with travel consumers indicate that future demand for cruise will be low. Similarly, with increased tolerance to recover their occupancy rate and revenue. Evidence from for virtual meetings and discussions, demand for products previous crises shows that there are lags in the different stages related to business travel may be reshaped. Governments of recovery – demand (passengers/visitors) first, followed by should focus on trends in their key market segments and revenues, profitability and finally investment. While these should be ready to accept that some business models indicators provide a useful backdrop, little is known at this may not be viable in the short-term such as nightclubs, time to predict the recovery profile of COVID-19. mass religious gatherings, sporting and music events, Currently, the information available is insufficient to make shopping outlets or entertainment venues which rely on high traffic volumes. This will help them determine what reliable predictions concerning the geographical and products and services they may need during the recovery temporal distribution and intensity (in terms of morbidity period and target investments on high-priority markets. and mortality) of the global pandemic. In the absence of Governments could also leverage technology and online such predictions, it is difficult to gauge the economic and platforms for expanded benefits of the industry. psychosocial impacts that the virus may have on the travel and tourism industry in the aftermath of the pandemic. If the 3. Consolidation of major operators in varied segments is likely, starting with airlines and hotels. In a scenario where pandemic is not contained, international travel and tourism global slowdown affects small and medium companies may remain stunted for a longer time. This may apply even if and less developed economies46 more acutely, much of the geographic distribution of the pandemic remains uneven. the diversity and sheer inventory of service providers may Countries that are relatively unaffected are likely to retain diminish. The larger firms, such as national airlines, tour restrictions on travel from countries that are more affected. operators, cruise lines or globally branded hotel operators, As the crisis continues to unfold, destinations and businesses are more likely to withstand stress or receive significant will face ongoing challenges as well as opportunities. Impacts, government support. Thus, in a recovery scenario, only a few players will be in a position to respond to the emerging trends, and sector needs are changing on a daily basis, making post-COVID-19 traveler demand, thus absorbing their it difficult to predict the new and uncertain future of travel erstwhile competitors’ share. It is possible that larger and tourism. However, assessing and analyzing key trends to firms will invest in vertically integrated value chains. For gauge the shifting ecosystem through pulse surveys — with example, a tour operator may need to invest in charter both supply and demand-side actors — will help inform aircraft, hotels, transport services, and guides because evidence-based decisions (see section below on Phase 2: these individual enterprises may not exist anymore. Short-term Recovery for specific guidance). Once there are Further, these firms may take the opportunity to expand signs of recovery, the Bank can leverage this information into new markets or diversify to capture more of the to inform clients on how to best guide recovery and how market share. This ‘consolidation’ effectively means more to build a better industry in the near future. Moreover, the larger vertically integrated and diversified enterprises, and global recovery period provides a unique opportunity to move more ownership/control of these enterprises in advanced the sector forward by addressing persistent challenges for a economies. For our client countries, this implies less stronger and more resilient sector. economic value and opportunity within the tourism sector unless there is strategic intervention. In the short-term, At a high level, the following are key points to watch and destinations should continue to monitor the changing monitor through pulse surveys with suppliers, travelers, and dynamics and identify strategic anchor businesses to build research. stronger relationships. 28 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 4. More liquid and agile players who can withstand the resulted in a surge in firms seeking to restructure their debt severity of the downturn could have a significant impact profiles. In order to ameliorate the impact of the shock on how countries emerge. For example, large OTAs can on otherwise solvent firms, create orderly exits for those easily switch between models and move demand quickly that continue to survive, and lessen the deflation of asset between destinations. They will be assessing which values, countries may need to strengthen insolvency and countries are coping better with the crisis and the recovery. resolution frameworks. These include legal frameworks This means, countries and destinations that are more for corporate and consumer debt restructuring and out- ‘market ready’ will be better placed to handle demand. of-court conciliatory measures. In particular, it will be Destinations are likely to be dependent on bigger players important for governments to introduce temporary and to drive demand — large hotel companies and airlines. time-bound measures to restructure debt and prevent Smaller businesses will struggle, and unaffiliated operators premature insolvency while not hindering processes to will be on their own. SMEs, destinations, and even some liquidate failed firms. of the hotels will need support on better engaging with OTAs to build strong distribution channels. 8. Governments will need to be aware of the trade-offs they face in determining policy responses. For example, 5. Governments will be conflicted. The need to capture while the timing of reopening borders will have a large renewed tax revenues just as firms are struggling to impact on the survival of the sector, it can also damage reopen or bounce back will put local, municipal/ destination credibility if done too early and infections provincial, state and national governments in a difficult increase. Further, many developing countries have position. Creative solutions will be essential to enable the limited fiscal space to support the sector beyond a few sector’s ability to generate jobs. Firms — while looking months, and governments may need to prioritize support for adequate public funds to support such efforts — will across the whole economy. Keeping people employed in require a new generation of policies and programs. As sectors that may take longer to bounce back could risk the industry rebounds, deferred taxation and prolonged restricting the ability of the market to channel resources tax holidays will inspire confidence in the private sector. to other sectors which might recover more quickly. 6. Many businesses that were directly or indirectly connected to tourism will need assistance to survive. Prioritizing private sector financing solutions will enable these Advice for World Bank Clients businesses to restructure. It will further ensure that only those firms best able to lead the recovery are supported so The World Bank’s response to client need is especially critical that supply can respond quickly when demand resumes. at this time. Countries including Sri Lanka, Zimbabwe, 7. As the effects of the pandemic continue, it will be Indonesia, Tunisia, Ethiopia, Albania, Egypt, and the increasingly difficult to support all firms. Support may Caribbean Islands have already sought advice on recovering need to be channeled to firms that have higher potential their tourism sectors. The M&T Global Tourism Team, to: lead recovery through stimulating demand, tap into while monitoring government responses, provides a menu of larger financial and organizational capital (which may options (below) based on the model of immediate response be difficult to replace), and those with greater capacity followed by recovery. An initial set of options was provided to support other less resilient firms in the supply chain. in a World Bank note and blog.47 Appendix 3 contains menus Consequently, policies will eventually adjust to the of response options by tourism subsector as well as options type of firms to be supported, the amount of resources for policy makers. The following are organized by immediate, available and the administrative capacity of each country. medium-term and long-term response. They cover, broadly Due to the collapse in demand across travel and tourism three main areas shown in the figure below with further and attendant deterioration in asset quality, the crisis has country examples in Appendix 3. Figure 15. Response Framework Liquidity injection cost reduction Health standards and protocols Improvement in tourism offering Immediate responses to keep Medium-term responses Long-term responses to the lights on to prepare for recovery Build Back Better Capacity Building, Digital Tools and Adjustment to New Business Models MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 29 Phase 1: Immediate Response (during the crisis and transfers to businesses operating in the hotels, tours, and early recovery) attractions of the tourism sector.52 • Government tax relief. Policies are in place to suspend Effective policy responses that can be utilized during the or reduce income tax payments, business rates, value crisis period have been identified from destinations around added tax (VAT) and other fees applicable to business, the world. The initiatives aim to help the industry avoid including pay-as-you-earn (PAYE) deferral or exemption insolvency and support tourism stakeholders so that they are to provide relief to staff on reduced incomes. New able to launch recovery when the time is right. Though not Zealand53 announced large-scale tax relief packages, and exhaustive, below is an initial list: Myanmar54 has waived two percent advanced income • Accepting and embracing travel bans. In countries where tax on exports. the spread of the virus is most virulent, tourism policy • Wage subsidies and income support to workers. In New has embraced public health directives and has stopped Zealand, businesses hard hit by the virus — experiencing marketing of any kind, urging everyone to stay at home. more than 30 percent decline in revenue compared with The sooner the outbreak is under control, the faster the last year — are eligible to receive wage subsidies to keep industry can start recovering. Estonia is an example.48 paying staff.55 Direct cash payments can be used for • Communicating effectively. Many tourism boards and workers who are most at risk including those operating Destination Management Organizations (DMOs) are in the gig economy. being proactive and keeping the industry and public • Support for industry to address contamination and informed about the latest developments affecting the protect the health of workers. Governments are providing destination. One specific approach is to create a National grants or subsidies to businesses to help contain the Response, Communication, and Recovery Task Force spread of the virus and to protect visitors and employees. including both public and private sector members. This For example, public minibuses in Kenya are carrying positions the destination as responsible, inspiring trust hand sanitizers. Singapore is supporting third-party costs and confidence among stakeholders. of professional cleaning services incurred by Singapore- • Deterring and monitoring all arrivals. All countries have licensed hotels that have provided accommodation to some level of international travel restrictions in place. suspected and confirmed COVID-19 cases.56 For example, Saudi Arabia and Australia have restricted • Subsidized training for tourism industry workers to entry to only citizens and residents. This is only increasing forestall layoffs. As a containment step, all staff should with time. Other countries have instituted a mandatory undergo health, hygiene, and emergency response 14-day quarantine requirement for any arrivals (Hong training. During the extended crisis period, workers in Kong).49 Singapore are enrolling in government-funded training • Waiving of fees by national carriers to retain revenues. programs and are being paid a portion of their salary (90 National carriers, along with most other commercial percent of wages for hourly workers). Effectively, this is a airlines, took measures to inspire confidence among subsidy for employers to keep workers on their payrolls consumers by waiving change and/or cancellation instead of laying them off, with the added incentive of fees for future bookings. Fiji Airways, for example, is upskilling them and boosting their productivity when selling bulk tickets for forward bookings to premier and their services are needed in the post-crisis period. corporate clients and waiving all change fees to generate • Repurposing tourism assets for crisis operations. Several income in the short-term. countries have already signed agreements with tourism • Property tax rebates or payment deferrals. These are facilities — hotels and conference centers — to repurpose utilized for hotels and other tourism businesses, including the facility for medical housing or quarantine.57 In for tenants in government properties, parks or facilities. Jamaica, Sandals Hotel has made the 38-room Sandals The United Kingdom government has announced a 100 Carlyle available for patients who are recovering and percent business rates holiday for the next 12 months to need to be monitored.58 cover all retail, hospitality, and leisure businesses.50 • Government grants. A policy of small grants for vulnerable Apart from governments, many other actors have stepped in businesses is being deployed to support enterprises with to respond during this crisis period, especially the banking short-term liquidity concerns. The United Kingdom is sector. Local banks are under pressure from both government offering further assistance of up to £25,000 for businesses and industry to extend lines of credit and working capital, and in hospitality, leisure, and retail.51 The Business Employee to defer or reduce debt servicing obligations. In developing Support and Transfer (BEST) program, launched by the countries where resources are more limited, the demand for a government of Jamaica, will provide temporary cash coordinated approach is going to be even greater. 30 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Phase 2: Short-term Recovery and access (visas, direct flights) are appealing will be important. Declaring special holidays and offering tax Once the crisis subsides or when the end point is clear, there deduction programs for domestic travel can help boost will be an immediate need for policy responses to support immediate domestic tourism. the recovery period. As noted earlier, recovery may not • Strategizing for recovery. When planning and positioning necessarily mean a full return to the pre-pandemic scenario the destination for a ‘rebirth,’ analyzing and adapting but an economic recovery of the sector. This may involve new business models. Based on experience, policy approaches for market position, product alignment, and regulatory and implementation immediately after the crisis include: zoning frameworks will help achieve the vision. Using this opportunity to reposition and renew products • Developing a periodic survey and assessing the need of and services will help the destination become more the tourism private sector. In times of crisis, information competitive. Online services in travel and tourism should and data are critical. A high-frequency monitoring be offered to maximize digital platforms and technology. phone/online survey (‘barometer’ or pulse survey) in • Relaunching destination through ‘back in business’ collaboration with concerned industry associations and/ augmented promotion to key source markets. Promotion or key informants can help identify emerging issues and and marketing budgets should be back to pre-crisis monitor recovery. These pulse surveys can also provide levels and augmented funding can support international insight into the needs of SMEs during the response and outreach and ‘open for business’ promotion activities; recovery phases for evidence-based decision making leverage regional promotion and coordination; and and real-time sector analysis. Destinations should also create a communications, branding, and market monitor changes in traveler sentiment to understand positioning strategy, eventually delivering a series which market segments will be the first to travel again of business-to-business events and communication and what investments are required to attract more messages, together with targeted marketing campaigns risk-adverse markets. For example, these may include to select market segments. improved health and hygiene at hotels and airports, • Assisting informal businesses to get registered where permanent health screening at airports, improved local possible. While governments should not force informal health care, and others. businesses to comply with complex legal requirements, • Utilizing the new IFC Fast Track COVID-19 Facility it is likely that many of the benefits/subsidies that — the first phase of its recovery response, worth up are or will become available can only be accessed by to $8 billion in immediate support — to assist private registered entities. Governments may ask informal sector companies to cope with the impact of the global businesses to simply register in order to access benefits pandemic. The IFC Facility will deliver fast and flexible and for better information, which can help later design solutions to clients across sectors and countries dealing with the spread of COVID-19. As part of the facility, policies towards the informal sector. The vast majority there is a $2 billion Real Sector Crisis Response Envelope of informal businesses are highly dependent on social and a $6 billion Finance Institutions Response Envelope. networks and community-based financing and do not The package focuses on providing financing for existing have access to the traditional financial sector. These may IFC investment clients that are in good standing. Within be best targeted through leveraging social protection, the tourism sector, this will focus on clients mainly in the microfinance and fintech solutions. accommodation sector. • Improving access to finance for registered tourism • Incentivizing business expansion and entrepreneurship. SMEs. Access to finance should be assessed, prioritized, Waivers for permit/license fees (both new issuance and and facilitated on favorable terms for key tourism SMEs renewals) for hotels, travel agents, and tour guides. These through guarantees, subsidized loans, extended credit can also be broadened for transportation services such lines, non-collateral financing, and a grace period for new as taxis and small buses. Permits and licenses should loans. Support for SME finance can be complemented still be issued to ensure quality and safety standards with support to improve their capabilities, including and measure sector recovery. Incentives for SMEs and upgrading their offerings and connecting to markets innovative ideas that fit the destination’s new strategic through digital platforms. identity should be considered. • Enhancing access and establishing additional global • Identifying target markets and ensuring openness. Some gateways. This could mean waiving or reducing landing markets will be more resilient and come back sooner fees and passenger airport taxes and expanding access to the destination (domestic, diaspora, repeat visitors, from individual countries with increased flights as younger demographics). Ensuring that products, pricing, operational supply reopens. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 31 • Understand the trade-offs of extending discount • Strengthen coordination of public and private sector offerings. The desire to reestablish arrival volumes collaboration. The ecosystem required to deliver by discounting on flight tickets, hotel stays, vacation goods and services to tourist markets requires a range packages, and others, can be counterproductive. Past of integrated activities across several government experiences show that once travelers are aware of institutions to coordinate policies, planning, investments, heavily discounted prices, it raises their expectations and and regulation. Destinations should review bottlenecks they start viewing these prices as the ‘new normal.’ and overlapping activities, align resources with pressing • Mobilizing digital platforms. P2P and other online needs, and streamline public sector organizational platforms may provide fast replacement for conventional responsibilities for improved effectiveness. products in the immediate aftermath of the crisis to • Define zoning policies to assure sustainable development, address potential shortages due to bankruptcies and staff particularly in areas of natural and cultural heritage sites. losses. A policy framework that allows these businesses Develop and enforce zoning guidelines in urban and to operate legally, pay taxes, and receive training in online sales should be considered. Digital technology rural areas to protect green areas and cultural heritage, may also be used by DMOs to improve safety, visitor and assure sustainable development going forward. management and crowding using real-time monitoring. • Invest in renewal. Upgrade and renew assets, products, • Devoting efforts to training and upskilling. During the and services in the destination to be more competitive, recovery period, reassure and retain staff at all levels including training service providers. for the long-term. Overcome the sector’s reputation for • Support sector sustainability through greening. Expand instability and sudden job loss with a focus on stability current programs and incentives for greening of the and longer-term job opportunities in the sector. In St. tourism sector and protect against increased single-use Maarten, following Hurricane Irma, employees from plastics and improper disinfectant usage. Destinations heavily damaged hotels were channeled into government and businesses have an opportunity during this global sponsored training while hotels were rebuilt. Time in tourism pause to reset their intentions and rebuild a training was paid for in the form of wages. tourism sector that is more sustainable, more valuable and better for local communities and the environment. Phase 3: Medium-term Recovery This could include incentivizing use of renewable energy Once travel picks up and gains momentum, destinations need sources and green and climate smart technologies.60 to consider instituting additional policy measures to be better • Diversify geographically. Strengthen efforts to diversify prepared for future shocks while improving competitiveness tourism geographically — from resorts to rural low- and building resilience – Building Back Better. Below are density destinations. some examples: • Improve data collection and support background analytical work to identify future market demand and • Direct public investment and conservation for jobs new product development to enable a fast recovery. and sustainability. The accelerated implementation of selected labor-intensive civil works or conservation Strengthening systems that adequately measure projects can help upgrade or reposition the destinations, economic impact, employment, and fiscal revenue are while creating jobs for low-skilled workers as it did important tools to build a stronger political economy for U.S. National Parks during the Great Depression.59 around the tourism sector. Assess capacity in tourism For example, this could include small infrastructure data collection, dissemination, and market research for upgrades, reforestation/afforestation activities, river and domestic and foreign segments to diversify markets and water channels cleaning, trail building or maintenance, identify vulnerabilities. or coastal conservation activities. • Tackle structural changes that can enable improved • Build awareness of tourism crisis management and competitiveness. Destinations, working in conjunction expanded training and certification programs for with their national governments, can leverage crisis managers to be qualified in tourism crisis management insights to shift from traditional products to those and response. in higher demand in the reconfigured marketplace. • Establish a crisis escrow account for rapid communication Opportunities to foster contestability across different response for the next crisis. Define structure, trigger markets within the sector could be revisited. processes and establish funding. This should be done along with capacity building for rapid response at While there will be opportunity to mobilize a wide range of the start of the next crisis and with strengthened policy options in the recovery phases, the immediate need is coordination of public and private sector collaboration. to focus on managing the present crisis. 32 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 33 5 Closing Considerations The COVID-19 global crisis is unprecedented. The uncertain lifecycle, geographical and temporal distribution, and intensity of the pandemic make it impossible at this time to predict the actual timing and path of recovery. However, one thing is certain: the global travel and tourism industry is already facing, and will continue to face, extraordinary challenges. The five biggest of these are: i) increasing focus on health and hygiene standards; ii) understanding how demand is changing (including the role of domestic and regional tourism); iii) interpreting changing business models due to consolidation and corporate restructuring; iv) mobilizing innovation and technology solutions impacting distribution and market access; and v) guiding public investments in destinations to position them for a more sustainable and resilient tourism industry post-COVID-19. Recovery will require phased actions and creative policies enabling all stakeholders to adapt to a new business landscape. The public and private sectors along with destination communities will need to work together to create solutions. Historically, demand is known to rebound after a crisis, though the recovery time may vary. In this instance, the tourism sector can expect substantial change in supply and demand patterns emerging from this crisis. There will likely be a downturn in disposable income leading to less travel for some groups, and renewed travel for higher-end market segments. Corporations are likely to experience consolidation as SMEs face extended distress and even bankruptcy. The World Bank will, therefore, also need to be flexible in its responses. 34 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Amidst this change, the future also promises many build back better with greater resilience and innovation at a opportunities for the sector to excel in its new form. The time when new technologies can offer widespread benefits post-COVID-19 global business environment will offer across the value chain. Supporting our clients to leverage unprecedented opportunity to address the sector’s long- these new opportunities strategically and efficiently is an standing structural challenges, which have traditionally unprecedented priority for the World Bank leadership. contributed to its underperformance. There will be scope to Appendix 1: Global Aviation Data Figure 16. Ratio of Year-on-Year Global Passenger Flight Arrivals by Country between Week of June 15, 2020 and 2019 68% 9% 25% 35% 14% 40% 37% 18% 26% 25% 13% 17% 10% 21% 33% 11% 18% 3% 20% 39% 12%10% 12% 9% 23% 36% 12% 11% 9% 28% 0% 5% 19% 26% 1% 0% 10% 3% 6% 0% 24% 46% 34% 5% 6% 81% 65% 11% 16% 27% 7% 36% 8% 7% 15% 25% 21% 5% 21% 20% 27% 40% 20% 73% 13% 40% 33% 10% 28% 31% 10% 3% 16% 48% Sudan 13% 20% 2% 19% 0% 20% 32% 29% 21% 0% 3% 100% 29% 7% 33% 0% 8% 0% 16% 0% 2% 10% 4% 17% 12% 9% 0% 16% 9% 8% 0% 15% 20% 19% 28% 48% 1% 35% 6% 0% 3% 15% 0% 0% 21% 71% 50% 34% 8% 12% 12% 15% 11% 100% 14% 24% 54% 0% 29% 8% 1% 1% 31% 21% 20% 0% 2% 6% 6% 0% 41% 100% Percentile of Y-on-Y Change 0% 100% Source: ETIMT Analysis using FlightRadar24 Data. Note: Colors have been scaled by percentile rather than raw percentage to highlight variations. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 35 27% 21% 25% 9% 3% 7% 4% 2% 33% 9% 16% 47% 94% 3% 0% 69% 3% 7% 5% 44% 4% 3% 5% 3% 7% 32% 2% 2% 3% 29% 2% 2% 19% 10% 30% 2% 8% 20% 2% 0% 20% 3% 10% 28% 11% 9% 4% 12% 8% 19% 26% 1% 10% 3% 5% 6% 0% 7% 65% 5% 6% 81% 11% 36% 7% 8% 7% 15% 15% 29% 5% 20% 21% 40% 10% 27% 10% 28% 31% 48% 0% 19% Sudan 6% 0% 21% 9% 78% 38% 7% 35% 4% 100% 29% 8% 0% 16% 8% 20% 0% 17% 16% 15% 9% 0% 0% 19% 28% 0% 36% 48% 8% 12% 71% 78% 12% 14% 8% 1% 24% 12% 0% 6% Percentile of Y-on-Y Change 0% 100% 36 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 68% 25% 9% 14% 37% 26% 14% 13% 20% 25% 21% 9% 8% 17% 9% 14% 11% 18% 6% 3% 20% 39% 10% 15% 25% 12% 12% 8% 13% 12% 10% 23% 20% 2% 0% 20% 3% 5% 10% 28% 8% 11% 9% 4% 12% 19% 26% 1% 10% 3% 5% 6% 0% 7% 81% 65% 6% 9% 10% 28% 26% 0% 1% 46% 34% 24% 81% 65% 36% 8% 15% 29% 20% 40% 40% 21% 27% 20% 73% 13% 10% 15% 0% 20% 13% 8% 20% 6% 16% 0% 17% 12% 0% 9% 0% 10% 20% 0% 48% 135% 6% 0% 50% 8% 100% 0% 34% 0% 12% 15% 54% 0% 29% 20% 41% Percentile of Y-on-Y Change 0% 100% MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 37 Appendix 2: Regional and Country Vulnerability Data of Tourism: Economic Dependence and Tourism Resilience Risk Score Figure 17. Total Contribution of Travel and Tourism to GDP, by number of countries with Severe, High, Medium or Low Dependency (WTTC, 2019) 30 Severe = >20% GDP from tourism High = 10-19.99% GDP from tourism 25 Medium = 5-9.99% GDP from tourism Numbers of Countries 20 Low = <5% GDP from tourism 15 10 5 0 East Asia & Europe & Latin America & Middle East & North South Sub-Saharan Pacific Central Asia Caribbean North Africa America Asia Africa Figure 18. Total Contribution of Travel and Tourism to GDP, by Country with Severe, High, Medium or Low Dependency (WTTC, 2019) Exposure Severe = >20% GDP in T&T High = 10-20% GDP in T&T Medium = >5-9% GDP in T&T Low = <5% GDP in T&T 38 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Appendix 3: Menu of Response Options Table 3. Response Options by Tourism Subsector Sub-sector Phase 1: Containment and immediate post-crisis response Phase 2: Recovery/medium-term Accommodation • Freeze loan repayments. • Restructure balance sheets when cash and lodging • Possible debt-for-equity swaps with distressed assets. is available. • Defer property and business taxes. • Exit equity once upturn stabilizes. • Convert outstanding receivables and inventory to cash • Mobilize capital for acquisition of distressed where possible. sales so that available operating stock can • Freeze marketing while assessing options and sequencing of bounce back quickly. market recovery. • Support destination management • Train staff to retain and upgrade skills. organizations and associations in destination • Consider repurposing hotels for isolation or residential renewal and repositioning efforts. lodging facilities if appropriate. • Continue training initiatives to enable • Rethink use of technology and online platforms for certification and career paths. expanded benefits. Airlines • Government/airport owners/operators to waive all airport- • Reassess priority routes including related fees — landing, slots, and others. identification of new, high potential routes. • Underwrite select carriers to keep operations open. • Selective ticket promotions for building of • Freeze asset purchases. off-season or shoulder period activity. • Maintain cargo operations to keep goods moving. • Consider redeploying staff to health services. • Offer staff (paid) training schemes. • Utilize seat subsidies selectively. Tour operators • Allow movable assets to be used as collateral. • Assistance in rebuilding supplier networks. • Expand and systematically conduct staff training for • Support programs that foster additional skills and to enhance quality. entrepreneurship especially in the • Freeze loan repayments. development of new tourism products and • Maintain supplier linkages. innovative offerings to attract new markets. • Expand supplier linkages. Cruise • Government/port owners/operators to waive port-related fees. • Rebuild confidence of consumers and • Consider repurposing vessels to support health efforts and to receiving ports through specific marketing provide emergency housing. campaigns to overcome negative image of the • Assess impacts on ports that are primarily ports of call for industry as part of the cause of the problem, day visitors versus those which are refueling and restocking i.e., Princess cruise ship saga in Japan. ports or home ports. • Leverage extensive experience of cruise • Plan for shifting local supply activities and amenities to subsector in recovering from health crises. focus on overnight visitors that fly in and out of destinations through demand analysis and support the development of new tourism product (for example, SMEs for tourism amenities, tours, experiences). Other linked • MSME needs assessment and credit facilities through local • Formalize capacity to foster cross-sector sectors and commercial banks. collaboration and PPD. related GVCs • Cash payments to retain staff. • Market reengagement as part of national • Training to improve health and hygiene levels for recovery. relaunch program. • Ongoing skills and quality training; certification programs that improve standards. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 39 Table 4. Response Options for Policy Makers Tourism Phase 1: Containment/ Phase 2: Recovery/ Comments and country short-term medium-term examples Government Work with government and private Lead planning and implementation of Crises cut across government agencies coordination sector to establish and support a Crisis ‘build-back-better’ initiatives. and activities — just as tourism does. and sector-based Response and Recovery Task Force. Therefore, encouraging and enabling • Use information collected in the health responses Use this platform to: governments to coordinate more first 6-12 months to develop a • Collect and analyze firm level (and in ways that are not ‘normal’ recovery strategy focused on data regarding revenue losses, job for them) is an important first step. building back a more resilient losses, and fiscal impacts. It communicates to the private sector and sustainable industry. • Collate and share international and communities that this is not • Improve tourism information best practices. ‘business as usual’ for the government and data management systems. • Coordinate development/donor or the private sector. Phase 1 and 2 are • Implement recovery planning to partners around specific short- an unusual situation that empowers build resilience and sustainability. term crisis response; develop government to do different and better analysis of regulatory and than usual. taxation for streamlining that can contribute to recovery. • Communicate common messaging to and with source markets and source market suppliers. • Facilitate health responses to adapt and restructure sector and businesses. Communication Accept and embrace travel bans. Evaluate markets and assess Past experiences of a wide range of • Adopt tourism policy that opportunities to diversify. crises that have impacted tourism embraces public health directives. show that consistent and clear • Identify target markets and • Cease marketing of any kind, communication throughout is integral ensure openness. urging everyone to stay at home. to i) engaging stakeholders through • Ensure products, pricing and access the most challenging times and during Expand timely and honest (visas, direct flights) are appealing. recovery; and ii) consistent, clear communication. • Declare special holidays and communication (of good news and offer tax deduction programs for • Tourism boards and destination not so good news) builds consumer domestic travel that helps boost management organizations engagement later. initial domestic tourism. should adopt a proactive role to communicate and inform Relaunch destinations. the industry and public about • Roll-out specific ‘back in business’ latest developments affecting the augmented promotion to key destination. source markets. • Work to position the destination • Return promotion and marketing as responsible and build trust budgets to pre-crisis levels and through providing cogent augment funding to support information to all stakeholders. international outreach and ‘open for business’. Promotion activities. • Leverage regional promotion and coordination. Financial and Property tax rebates or payment deferrals Lower or eliminate arrival fees and • The United Kingdom government job-saving for hotels and other tourism businesses, related taxes for key flights from has announced a 100 percent responses including for tenants in government traditional and new key source business rates holiday for the properties, parks or facilities. markets. next 12 months to cover all Fee waivers by national carriers and retail, hospitality, and leisure • Consider subsidizing air transport other commercial airlines. businesses. tickets (small fee paid by • Subsectors — especially air transport government, motivating agents to and cruise lines to take measures sell tickets at a perceived lower cost) to inspire confidence in booking utilized carefully and selectively for flights by waiving change and/or limited time periods to kick-start a cancellation fees for future bookings. low or usually high season. 40 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Tourism Phase 1: Containment/ Phase 2: Recovery/ Comments and country short-term medium-term examples Liquidity/grants Government grants or subsidies to Improve access to finance for • In Jamaica, for example, the businesses specifically to help contain registered tourism businesses. government launched a Business the spread of the virus. Employee Support and Transfer • Assess, prioritize, and facilitate (BEST), which will provide Wage subsidies to keep paying staff. access to finance on favorable temporary cash transfers to terms for key tourism SMEs Support small grants for vulnerable businesses operating in the by creating a guarantee facility businesses deployed to support hotels, tours, and attractions of managed through government enterprises with liquidity concerns. the tourism sector. Kenya and and private sector associations. Morocco are working on similar • Digitize licensing, registration packages. and government to business • In New Zealand, businesses hard- interactions and payments. hit by the virus (experiencing • Support recovery through more than a 30 percent decline in integrated WBG instruments revenue compared with last year) leveraging grant financing and will be eligible to receive wage COVID-19 emergency funds. subsidies. • The United Kingdom is offering further support of up to £25,000 for businesses in hospitality, leisure, and retail. • Singapore is supporting third- party cost of professional cleaning services incurred by Singapore-licensed hotels that have provided accommodation to suspected and confirmed COVID-19 case(s). Training/ Subsidized training for tourism Reassure and retain staff at all levels • In response to various crises, upskilling industry workers to forestall layoffs. for the long-term. workers in Singapore have to keep jobs enrolled in government-funded • Enable a subsidy for employers • Overcome reputation of the and improve training programs and are being to keep workers on their payrolls sector for instability and sudden competitiveness paid a portion of their salary instead of laying them off, with job loss with an active focus on (90 percent of wages for hourly the added incentive of upskilling the longevity and longer-term workers). workers and boosting their opportunities in the tourism • In Samoa, when several large productivity. when their services sector for employment. hotels were suddenly inoperable are again needed in the post-crisis • Enhance health, hygiene, and due to a hurricane, staff from period. emergency response training for those hotels were temporarily • Support that enables an increase all staff. absorbed for ‘training’ in the in standards and delivery of remaining hotels with their services. ‘wages’ funded through donor support. • In St. Maarten, following Hurricane Irma, employees from highly damaged hotels were channeled into government sponsored training programs while hotels were rebuilt. Time in training was paid for in the form of wages. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 41 Tourism Phase 1: Containment/ Phase 2: Recovery/ Comments and country short-term medium-term examples Plan and invest Promote planning for post-crisis Foster and support entrepreneurship. in recovery itineraries and booking of travel and • Emphasize creation of new and accommodation. innovative products that can • Provide forward credits (rather help build visitor volume and than refunds where appropriate). encourage previous visitors to • Engage online services in travel return for ‘something familiar’ and tourism for maximum and ‘something new’. utilization of digital platforms • Incentivize business expansion and technology. and entrepreneurship through waivers for permit/license fees (both new issuance and renewals) for hotels, travel agents, and tour guides, and transportation services such as taxis. • Enhance access and establish additional global gateways by reducing landing fees and passenger airport taxes and expanding access to and from individual countries with increased flights as operational supply reopens. Support sector Build caring profile of the sector. Enhance specific regulations enabling In previous crises, hotels have provided sustainability sustainability and competitiveness. emergency lodging and shelter for • Consistent communication that victims. This has built enormous tourism is a resilient industry and • Define zoning policies to goodwill that carries through recovery that it will support communities assure sustainable development and the next crisis. The tourism sector throughout the crisis and particularly in areas of cultural — with its fundamental elements of afterwards during recovery. heritages sites. transportation, lodging, and services • Strengthen sector cohesiveness • Develop and enforce zoning — is uniquely positioned to ‘host’ and longevity through genuine guidelines in urban and rural these acts, which are remembered support for employees, businesses, areas to protect green areas, long after the specific crisis. During communities, and others, in crisis protect cultural heritage, and 9/11, hotels in Ground Zero provided period. assure sustainable development emergency meals and support to going forward. communities in the immediate vicinity • Expand current programs and that built commitment to the sector incentives for greening of the for years to come (and even now as tourism sector and increase they face COVID-19). awareness of sustainable development such as incentivizing use of renewable energy sources and green technologies. 42 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS Figure 19. International Examples of Specific Measures to Support the Tourism Sector Improvement to the Adaptation and sector Liquidity injection tourism offering (services, Use of digital tools restructuring (health and cost reduction infrastructure, locations, and platforms safety standards, protocols) experience) Armenia: Cash transfer Chile: Toolkit to reactivate Argentina: US$100million Chile: to support workers and the sector, designed with for public works in tourism, • Free online webinars entrepreneurs in the input by key stakeholders house renovation, schools and talks on tourism- tourism sector and retail and institutions. and kindergarten. related issues. (US$137-274). • Technical assistance Singapore: 7 points China: 346 construction to improve business Italy: €600 one-time standard hygiene program projects identified to be management payment for self-employed for hotels and other financed by the central processes and digital and professionals in the services, campaign ‘SG government. skills for tourism agricultural, tourism and Clean’. entrepreneurs. cultural sectors. Portugal: Health and Egypt/Israel/Greece: Malaysia: (a) double hygiene standards (‘Clean Online tours of cities and deduction in expenditures and Safe’). attractions. used to provide training in New Zealand/Australia: tourism and related sectors New Zealand/Australia: ‘Bubble’ to allow travel (b) provide RM50 million Delivery services for between the two to finance short courses in restaurants and other destinations. digital and high level skills businesses using digital (100,000 beneficiaries). Albania: Protocol of 7 rules platforms. to re-opening the beaches. Singapore: Application and promotion of digital payment tools, such as mobile wallets and others, to avoid contact. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 43 Endnotes 1 https://www.unwto.org/news/covid-19-world-tourism-remains-at-a-standstill-as-100-of-countries-impose-restrictions-on-travel 2 https://www.wttc.org/about/media-centre/press-releases/press-releases/2020/latest-research-from-wttc-shows-an-increase-in- jobs-at-risk-in-travel-and-tourism/ 3 http://www.oecd.org/cfe/COVID-19-SME-Policy-Responses.pdf 4 https://cdn.centreforaviation.com/analysis/reports/covid-19-by-the-end-of-may-most-world-airlines-will-be-bankrupt-517512 5 https://www.ahla.com/covid-19s-impact-hotel-industry 6 https://www.cdc.gov/media/releases/2020/s0409-modifications-extension-no-sail-ships.html 7 https://www.forbes.com/sites/greatspeculations/2020/04/06/norwegian--royal-caribbean-down-80-is-either-now-a-good- value/#5c078536529d https://www.fool.com/investing/2020/04/11/why-royal-caribbean-carnival-and-norwegian-cruise.aspx 8 Depoux, A., Martin, S., Karafillakis, E., Preet, R., Wilder-Smith, A., and Larson, H. “The pandemic of social media panic travels faster than the COVID-19 outbreak”. Centre Virchow-Villerme, Paris, France London School of Hygiene and Tropical Medicine, London, U.K. Department of Epidemiology and Global Health, Umeå University, Umeå, Sweden. 9 https://ourworldindata.org/age-structure 10 Official Aviation Guide, https://www.oag.com/coronavirus-airline-schedules-data 11 https://www.iata.org/en/iata-repository/publications/economic-reports/covid-19-outlook-for-air-travel-in-the-next-5-years/ 12 https://www.iata.org/en/iata-repository/publications/economic-reports/liquidity-is-crucial-for-airlines-to-overcome-covid- 19-pandemic/ 13 https://centreforaviation.com/analysis/reports/covid-19-by-the-end-of-may-most-world-airlines-will-be-bankrupt-517512 14 https://samchui.com/2020/05/12/covid-19-list-of-airlines-that-didnt-survive/#.Xry6XqhKiHs 15 Prior to 9/11, the United States had nine major airlines: American Airlines; America West; U.S. Airways; Delta; Northwest; United; Continental; Southwest; and AirTran. Five of these airlines entered bankruptcy in the wake of 9/11 or the GFC (American Airlines in 2010; U.S. Airways in 2002 and 2004; Delta and Northwest in 2007 and United in 2002). As of 2013, the nine major airlines had consolidated through mergers and acquisitions into just four airlines (American Airlines [which acquired America West, which had previously acquired U.S. Airways]; Delta [which acquired Northwest]; United [which merged with Continental]; and Southwest [which acquired AirTran]). (https://money.cnn.com/infographic/news/companies/ airline-merger/). 16 https://str.com/press-release/str-us-hotel-results-week-ending-11-april 17 COVID-19 - a global insight on travel and tourism impacts UNWTO & Data Partners 21 April 2020. 18 https://www.hospitalitynet.org/opinion/4097673.html 19 https://str.com/data-insights-blog/covid-19-webinar-summary-5-key-points-latin-america-hotel-performance-24-march 20 https://www.wttc.org/members-hub/ 21 The World Bank (2018) Tourism and the Sharing Economy: Policy and Potential of Peer-to-Peer Accommodation. 22 22 tour operators contacted across Tanzanian and Ugandan markets confirmed similar trends. 23 https://cruising.org/-/media/research-updates/research/state-of-the-cruise-industry.pdf 24 IFC, Assessment of the Economic Impact of Cruise Ships to Vanuatu, 2014. 25 https://www.cdc.gov/mmwr/volumes/69/wr/mm6912e3.htm?s_cid=mm6912e3_e 26 https://www.cdc.gov/media/releases/2020/s0409-modifications-extension-no-sail-ships.html 27 https://time.com/5802661/coronavirus-cancellations-workers/ 28 https://story.californiasunday.com/below-deck 29 https://edition.cnn.com/2020/04/01/business/carnival-cruise-debt-coronavirus/index.html 30 World Bank (2018) The Voice of Travelers: Managing User-Generated Content for Sustainable Tourism Development. 31 https://www.phocuswire.com/expedia-layoffs-streamlines-operations 32 https://ir.expediagroup.com/news-releases/news-release-details/expedia-group-withdraws-2020-guidance-due-covid-19-impact 33 https://www.webintravel.com/sabre-makes-over-us200-million-in-cuts-in-response-to-covid-19/ 34 https://www.businessinsider.es/impacto-economico-mobile-world-congress-barcelona-377975 35 https://www.bloomberg.com/news/articles/2020-03-11/clipped-wings-virus-kills-a-16-year-boom-for-boeing-and-airbus 44 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 36 https://umassociation.wpengine.com/wp-content/uploads/sites/4/2020/03/Dunham-Econ-Impact-031620.pdf 37 WTTC (2019) Economic Impact Country Analysis. https://www.wttc.org/economic-impact/ 38 WEF (2019) The Travel & Tourism Competitiveness Report 2019 Travel and Tourism at a Tipping Point. https://www3.weforum.org/docs/WEF_TTCR_2019.pdf 39 Categorized as a small island developing state by UNSIDS. 40 As noted in WEF 2019 p. 86, TTCI is calculated as an average (arithmetic mean) of the four component sub-indices (sum of all observations over count of observations), which are themselves calculated as averages (arithmetic means) of their pillars. Each of the pillars is calculated as an un-weighted average of the individual component variables. 41 A sensitivity analysis was conducted and verified that the pillars are closely correlated, so no weighting was applied (correlation coefficient of 0.96 for both income categories - Spearman Rank Order correlation, statistically significant at the 99 percent confidence interval). 42 World Bank Group. “Support to Systematically Large Firms in Hard-Hit Sectors: The Case of Airlines Stat-Support Programs amid COVID-19”. FCI Global Markets & Technology Unit. June 29, 2020. 43 Live updates at: http://wbgmssqlefip001.worldbank.org/Analytics/powerbi/Topic/MAT/IND-COVID19 44 2008 IEG Report “Lessons from World Bank Group Support to Previous Financial Crises”. 45 https://www.mckinsey.com/business-functions/risk/our-insights/covid-19-implications-for-business 46 https://www.mckinsey.com/business-functions/risk/our-insights/covid-19-implications-for-business 47 http://documents.worldbank.org/curated/en/478761584725100731/pdf/WBG-Support-for-Tourism-Clients-and- Destinations-During-the-COVID-19-Crisis.pdf?deliveryName=DM57356 https://blogs.worldbank.org/voices/we-cant-travel-we-can-take-measures-preserve-jobs-tourism-industry 48 https://twitter.com/visitestonia/status/1238885142237773838 49 https://www.straitstimes.com/asia/east-asia/hong-kong-to-quarantine-all-people-entering-the-city-from-thursday 50 https://www.fsb.org.uk/campaign/covid19.html 51 https://www.fsb.org.uk/campaign/covid19.html 52 https://mof.gov.jm/mof-media/media-centre/press/2633-fiscal-stimulus-response-to-the-covid-19.html 53 https://www.newshub.co.nz/home/politics/2020/03/covid-19-12-billion-package-includes-wage-subsidies-tax-relief-and- sick-leave-support-amid-coronavirus-pandemic.html 54 https://www.irrawaddy.com/news/burma/myanmar-govt-suspends-advance-tax-exports-aid-virus-hit-businesses.html 55 https://www.theguardian.com/world/2020/mar/17/new-zealand-launches-massive-spending-package-to-combat-covid-19 56 https://www.stb.gov.sg/content/stb/en/assistance-and-licensing/Support-for-Cleaning-Disinfection-Costs.html 57 https://www.wsj.com/articles/new-york-city-weighs-turning-hotels-into-hospitals-11584556841 58 https://www.travelmole.com/news_feature.php?c=setreg®ion=3&m_id=s~bmmbs~&w_id=37375&news_id=2042120 59 https://www.smithsonianmag.com/smart-news/you-can-thank-these-depression-era-workers-your-national-parks-180960284/ 60 https://www.unwto.org/covid-19-oneplanet-responsible-recovery; Ioannides, Dimitri & Gyimóthy, Szilvia. (2020). The COVID-19 crisis as an opportunity for escaping the unsustainable global tourism path. Tourism Geographies. 1-9. 10.1080/14616688.2020.1763445. MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 45 46 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS 47 Email us at tourism@worldbankgroup.org Engage with us on social media at #tourism4dev © 2020 The World Bank Group 48 MARKETS & TECHNOLOGY REBUILDING TOURISM COMPETITIVENESS