We all know that the travel industry was perhaps the sector that suffered the most during the pandemic. This was especially true in the early days, when company revenues did not just decline, they crashed off unimaginable cliffs. After a brief reprieve last summer, the devastation continued throughout the remainder of 2020. Summer 2021 was supposed to be the era of the “Great Reopening”, but as we have seen, delays in vaccine rollouts have stifled Europe’s best efforts. So, as we enter midsummer, what does the data say about the summer so far?
To understand how things are this year, we have to understand just how bad things were last year. Some countries were hit harder than others due to an uneven reliance on tourism across the bloc. The highest decreases in intra-EU tourism were recorded in Malta, Spain, Greece, Portugal, and Hungary, with each of these countries experiencing a decrease of more than 60 per cent. Spain’s economy was particularly devastated by the decline in foreign tourism money because, in normal circumstances, tourism makes up 12 per cent of the country’s GDP. According to the Bank of Spain, income from foreign tourists during peak season (July through September) was down 78% in 2020 compared to 2019. Other tourism-reliant countries like Portugal and Greece also suffered considerable economic harm. Greece saw a tourism decline of 77 per cent according to the Greek Tourism Confederation.
Such devastating declines have been a clear motivation for these countries to have relatively lax limitations on foreign tourists in 2021. But has it had the desired effect? Have these countries managed to stem the economic bleeding?
2021’s Bated Breath
For obvious reasons, we do not yet have data about peak season. The Spanish government has publicly predicted around 17 million international arrivals this summer. Although this number is just 45 per cent of 2019’s figures, it is three times the international visitor rate of last summer. Even though the data is looking promising, recent Delta variant-related outbreaks in Spain have put fears of cancellation in the minds of Spanish operators. France recently advised its citizens against travelling to Spain and Portugal due to their massive spike in COVID cases. If governments, local or federal, are forced to put restrictions in place, it will certainly curb tourism, especially if other destinations (like France) have relatively low infection rates. That said, the Spanish tourism industry has downplayed the risk to visitors since most of the country’s infections are among young people who have not yet received vaccines.
A Shifting Calculus
As we have seen from our business partners, it feels like everybody in Europe could really use a long vacation. Before COVID, the hard part of vacations used to be figuring out where to go. In 2020, it became about figuring out where it’s safe to go. With vaccines, the summer of 2021 is all about determining where we can go without too many restrictions.