Strong Start For Tourism In 2022
The UNWTO reports that international tourism continued its recovery in January 2022, with a much better performance compared to the weak start to 2021. However, the Russian invasion of Ukraine adds pressure to existing economic uncertainties, coupled with many COVID-related travel restrictions still in place. And the organization continued that overall confidence could be affected and hamper the recovery of tourism.
Based on the latest available data, global international tourist arrivals more than doubled (+130%) in January 2022 compared to 2021 — the 18 million more visitors recorded worldwide in the first month of this year equals the total increase for the whole of 2021.
While these figures confirm the positive trend already underway last year, the pace of recovery in January was impacted by the emergence of the Omicron variant and the re-introduction of travel restrictions in several destinations.
Following the 71% decline of 2021, international arrivals in January 2022 remained 67% below pre-pandemic levels.
The UNWTO said that after the unprecedented drop of 2020 and 2021, international tourism is expected to continue its gradual recovery in 2022.
As of March 24, 12 destinations had no COVID-19 related restrictions in place and an increasing number of destinations were easing or lifting travel restrictions, which contributes to unleashing pent-up demand.
The war in Ukraine poses new challenges to the global economic environment and risks hampering the return of confidence in global travel. The US and the Asian source markets, which have started to open up, could be particularly impacted especially regarding travel to Europe, as these markets are historically more risk averse.
The shutdown of Ukrainian and Russian airspace, as well as the ban on Russian carriers by many European countries is affecting intra-European travel. It is also causing detours in long-haul flights between Europe and East Asia, which translates into longer flights and higher costs.
Russia and Ukraine accounted for a combined 3% of global spending on international tourism in 2020 and at least US$ 14 billion in global tourism receipts could be lost if the conflict is prolonged. The importance of both markets is significant for neighbouring countries, but also for European sun and sea destinations.
The Russian market also gained significant weight during the pandemic for long haul destinations such as Maldives, Seychelles or Sri Lanka. As destinations Russia and Ukraine accounted for 4% of all international arrivals in Europe but only 1% of Europe’s international tourism receipts in 2020.
And while the UNWTO says that it’s too early to assess the impact, air travel searches and bookings across various channels showed a slowdown the week after the invasion but started to rebound in early March.
It is certain that the offensive will add further pressure to already challenging economic conditions, undermining consumer confidence and raising investment uncertainty.
The Organisation for Economic Co-operation and Development (OECD) estimates global economic growth could be more than 1% lower this year than previously projected, while inflation, already high at the start of the year, could be at least a further 2.5% higher.
The recent spike in oil prices (Brent reached its highest levels in 10 years), and rising inflation are making accommodation and transport services more expensive, adding extra pressure on businesses, consumer purchasing power and savings, UNWTO notes.
