The world economy could lose about $ 4 trillion due to a pandemic

According to the report of UNCTAD, ie the United Nations Conference on Trade and Development, the impact of the coronavirus pandemic on the decline of international tourism could cause a loss of more than 4 trillion US dollars ...

According to a report by UNCTAD, the United Nations Conference on Trade and Development, the impact of the coronavirus pandemic on the decline in international tourism could cause a loss of more than 4 trillion US dollars in global GDP for 2020 and 2021. The estimated loss is caused by the direct impact of the pandemic on tourism and its impact on other sectors closely related to it.

In 2020, according to the report, international tourism and related sectors, due to the direct and indirect impacts of the sharp decline in international tourist arrivals, had a loss of $ 2,4 trillion. A similar loss could happen this year as well, the report warns, noting that the recovery of the tourism sector will largely depend on the introduction of the vaccine against COVID-19 globally.

As vaccination is more pronounced in some countries, the report says, tourism losses have been reduced in most developed countries but exacerbated in developing countries. Vaccination rates against COVID-19 vary and range from below 1% of the population in some countries to over 60% in others.

The asymmetric introduction of vaccines exacerbates the economic downturn that tourism has suffered in developing countries, as it could up to 60% of global GDP losses. The tourism sector is expected to recover faster in countries with high vaccination rates, such as France, Germany, Switzerland, the United Kingdom and the United States, the report said.

However, according to the UNWTO, experts do not expect a return to the level of international tourist arrivals before COVID-19 by 2023 or later. The main obstacles are travel restrictions, slow virus control, poor passenger confidence and a poor economic environment.

A recovery in international tourism is expected in the second half of this year, but a UNCTAD report still shows a loss of between $ 1,7 billion and $ 2,4 trillion in 2021., compared to 2019 levels. The results are based on simulations that record the effects of declining international tourism, but not on policies such as economic incentive programs that can mitigate the impact of the pandemic on the sector.

The report assesses the economic effects three possible scenarios, and all show a decrease in international arrivals in the tourism sector.

In the first scenario projected by the UNWTO, reduction of international tourist arrivals by 75% - the most pessimistic forecast was made based on the decrease in the number of tourists observed last year. In this scenario, a drop in global tourism revenues of $ 948 billion causes a loss in real GDP of $ 2,4 trillion. This ratio varies greatly from country to country, from single to triple or quadruple.

The second scenario The UNWTO is somewhat less pessimistic and reflective reduction of international tourist arrivals by 63%.

The third scenario, developed by UNCTAD, considers different rates of domestic and regional tourism in 2021. It's assumed a 75% reduction in tourism in countries with low vaccination rates and a 37% reduction in countries with relatively high vaccination rates, mainly developed countries and some smaller economies.

According to the report, the decline in tourism on average causes an increase in the unemployment of unskilled labor by 5,5%, with a large variation from 0% to 15%, depending on the importance of tourism for the economy.

In July last year, UNCTAD estimated that a stalemate in international tourism, four to 12 months, would cost the global economy between $ 1,2 billion and $ 3,3 trillion, including indirect costs. But the losses are worse than previously expected, as even the worst-case scenario projected by UNCTAD last year proved optimistic and international travel is still low, more than 15 months after the start of the pandemic.

According to the UNWTO, international tourist arrivals fell by about a billion or 73% between January and December 2020. In the first quarter of this year, the UNWTO World Tourism Barometer indicates a decline of 88%.

Source: U

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