Travel recovers strongly, but uncertainties remain in the air
The international travel and tourism sector will continue its recovery in 2022, performing much better compared to the weakness manifested in early 2021. However, Russia's invasion of Ukraine will add to the already existing economic uncertainties, coupled with the numerous travel limitations imposed by Covid still in place, as reported by UNWTO.
According to the latest available data, worldwide 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 recorded in all of 2021.
Although these figures confirm the positive trend that began last year, the path of recovery in January was affected by the emergence of the microbial variant and, consequently, the reintroduction of travel restrictions in several destinations.
After the 71% decline experienced in 2021, international arrivals in January 2022 remained 67% below pre-pandemic levels.
All regions experienced a significant rebound in January 2022, although it should be noted that this compares to the low levels recorded in early 2021.
Europe (+199%) and America (+97%) continue to show the best results, with international arrivals still at half of pre-pandemic levels.
Middle East (+89%) and &Africa (+51%) alsoén recorded an increase in January 2022 over 2021, but these regions experienced a decline of 63% and 69%, respectively, compared to 2019.
Although Asia and the Paci Pacific saw a year-on-year increase of 44%, several destinations remained closed to non-core travel, leading to the largest decline in international arrivals since 2019 (-93%).
BY REGION
By sub-region, the best results were presented in Western Europe, quadrupling the number of arrivals recorded in January 2022 compared to 2021 data, but down 58% from 2019.
Both the Caribbean (-38%) and Southern Europe (-41%) have shown the fastest rates of recovery compared to 2019 levels.
Several islands in the Caribbean, as well as in Asia and the Pacific, along with some small European and Central American destinations have the best results compared to 2019: Seychelles (-27%), Bulgaria and Curaçao (both -20%), El Salvador (-19%), Serbia and Maldives (both -13%), Dominican Republic (-11%), Albania (-7%) and Andorra (-3%). Bosnia and Herzegovina (+2%) even exceeded pre-pandemic levels. Among the top destinations, Turkey and Mexico experienced declines of 16% and 24%, respectively, compared to 2019.
PERSPECTIVES FOR RECOVERY
After the unprecedented drop in 2020 and 2021, international tourism is expected to continue its gradual recovery through 2022.
As of March 24, 12 destinations were free of covid-19-related restrictions and a growing number of destinations were relaxing or removing limitations on travel, helping to release pent-up demand.
The war in Ukraine poses new challenges to the global economic environment and could hinder the recovery of confidence globally. U.S. and Asian source markets, which have begun to open up, could be particularly affected with regard to travel to Europe, as these markets are historically more cautious about risk.
The closure of the Ukrainian and Russian air space, as well as the operating ban imposed by many European countries on Russian airlines, is affecting domestic travel on the continent. It is also causing diversions on long-haul flights between Europe and East Asia, resulting in longer flights and higher costs.
Russia and Ukraine together accounted for 3% of global international tourism spending in 2020 and, if the conflict is prolonged, at least $14.The importance of both markets is significant for neighboring countries, but also for European sun and beach destinations. The Russian market has also gained weight during the pandemic for long-haul travel such as Maldives, Seychelles or Sri Lanka.
As destinations, Russia and Ukraine accounted for 4% of all international arrivals to Europe, but only 1% of the continent's international tourism receipts in 2020.
ECONOMIC UNCERTAINTY
Although it is too early to assess the impact, searches and bookings in various channels showed a slowdown a week after the invasion, but picked up in early March.
No doubt, the offensive will add more stress to already difficult economic conditions, undermining consumer confidence and increasing uncertainty for investment.
The Organisation for Economic Co-operation and Development (OECD) estimates that global economic growth this year could be higher than expected;
World economic growth this year could be more than 1% lower than previously forecast, while inflation, already high at the beginning of the year, could rise by at least 2.5%.
The recent rise in oil prices and the increase in inflation are making accommodation services more expensive;The UNWTO notes that the increase in inflation is making accommodation and transportation services more expensive, adding additional pressure on businesses, consumer purchasing power and savings.
This forecast coincides with the United Nations Conference on Trade and Development's (UNCTAD) analysis of the conflict's potential impact on economic recovery and global growth, which has also downgraded its forecast to a lower level;UNCTAD has lowered its forecast for global economic growth in 2022 from 3.6% to 2.6% and warned that developing countries will be the most vulnerable to the slowdown.