Corresponding author: Marina Y. Sheresheva ( m.sheresheva@mail.ru ) © 2020 Marina Y. Sheresheva.
This is an open access article distributed under the terms of the Creative Commons Attribution License (CC BY 4.0), which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.
Citation:
Sheresheva MY (2020) Coronavirus and tourism. Population and Economics 4(2): 72-76. https://doi.org/10.3897/popecon.4.e53574
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In the previous decade, the Russian tourism industry has shown steady development. But in 2020, due to the consequences of the COVID-19 pandemic, the situation is close to disaster. It is necessary to provide not only urgent support for industry actors but also the conditions for the successful resumption of their activities in the long term. The pandemic raised the question of joint survival – both literally and figuratively. The tourism industry is a good example to understand that it is possible either to bring the situation to a complete catastrophe or to provide a relatively good start for recovery in the foreseeable future. It all depends on how market actors behave and what decisions will be made by the state. For market actors, it is important to understand that the successful development of business ecosystems involves not only competition but also mutual assistance, which is extremely important for the progressive development of any industry, especially in times of crisis. For the authorities, it is important to understand that tourism may turn out to be not a burden, but one of the engines of economic recovery if taxation is changed and the focus is on supporting domestic and inbound tourism.
COVID-19, tourism, pandemic, crisis, public policy, consumers
In Russia, there is no specialized Ministry of tourism – unlike Greece, Israel, Brazil or South Africa. After the collapse of the USSR, tourism could for a long time not be sorted out in the country, being affiliated to sports management (Goskomsport of the Russian Federation) then to culture (Ministry of Culture of the Russian Federation). Finally, in 2018 the Federal Agency for Tourism was affiliated to the Ministry of Economic Development of the Russian Federation – therefore, tourism was recognized not as a purely cultural phenomenon, but a branch of the economy. And right here came a storm named COVID-19.
Since tourism was mixed with sports for a long time, and I had long personal experience in sports throughout my student life, I remembered the often heard phrase that sports is a model of life compressed in time: for about 15-20 years an athlete goes through all stages of career growth, with their benefits and costs, and much faster than others faces the search for new meaning of life after “retiring”.
It seems that now the tourism industry can be given laurels of a time-compressed model of the modern economy: the storm which is yet coming to all areas of economic activity collapsed tourism industry immediately, in February 2020, of course, if considering the tourism industry as the activities of a huge network of actors representing the system of related industries (
The current pandemic is most interesting because it brightly and vividly highlighted all the accumulated challenges of the global economy (
Tourism has shown how fast this is happening: within two months, all tourist destinations were closed, both for organized and independent tourists. The industry has collapsed all over the world. For example, in the U.S. a drop of 80% in 2020 is predicted (Forum Digital: Will the hotel and tourism industry survive under the conditions of quarantine?) and the tourism industry may lose USD 24 billion (
As to Russian tourism, over the past few years the industry has shown steady development (
The area of tourism also shows that it is possible to bring the situation to a complete catastrophe, and to achieve quite a good result in the foreseeable future. It all depends on how market participants behave and what decisions will be taken by the state.
Practices of today’s tour operators work with tourists prove that Russia has developed a core of responsible business with its loyal customer base. Many tour operators coordinate with those who plan a future vacation, transfer of the tour date at a fixed currency exchange rate at the time of purchase: it will actually be lower than with a new booking. “In addition, tourists, tour operators and accommodation facilities are already negotiating to deposit funds with additional privileges for travellers” (Federal Agency for Tourism (Rosturizm): Address by Doguzova Z.V., Head of the Federal Agency for Tourism).
However, there will be changes in behaviour and preferences of tourists. For example, how does one now answer the question, where is it better to spend a vacation, in Russia or abroad? After the coronavirus was labelled “Courchevel flu” on social networks (note that there tourists were often mashed by the local intestinal flu even before), and passengers of prestigious cruise vessels were hostages of the situation, threated by infection via the air conditioning system in their cabins, for most well-to-do Russians the above question ceased to seem strange or rhetorical. There is another question, what to prefer: a tour organized by tour operators or independently organized? And if you choose an independent option, then a traditional hotel or a private apartment via Airbnb? (
As for the measures of state support announced by the President and the Government of the Russian Federation, it can be generally argued that the experience of China, which was first to face the coronavirus pandemic, was analyzed and taken into account. However, currently the Government is solving the most urgent tasks and pays little attention to the sectoral specifics in terms of supporting the national economy. However, different industries call for different support measures.
Such a multi-layered and complex industry as tourism may not be a burden, but a locomotive of economic recovery if taxation is changed in a way that is beneficial “to emerge from the shadows” in exchange for the help of the state. Now, the hotel business is highly transparent, while travel agencies and catering companies largely continue to operate “in the shadow”. Another option is the shift to domestic and inbound tourism support. It is estimated that before the pandemic, tourism industry generated income about USD 9 billion to the budget of Russia, and at the same time, up to USD 45 billion (five times greater) were annually slipped away with the tourists to other countries (Forum Digital: Will the hotel and tourism industry survive under the conditions of quarantine?). Calculations of experts show that it is sufficient to allocate about RUB 100 billion in aid (according to calculations, this will suffice for tourism industry, hotels and catering combined) to yield twice as much, up to RUB 240 billion, in the form of taxes already in 2021. (Forum Digital: Will the hotel and tourism industry survive under the conditions of quarantine?). The enormous underutilized potential of domestic and inbound tourism (see, for example, the interactive map of local brands (Living heritage)) can be the basis for rebuilding and reorienting value chains, formation and promotion of new destinations in conditions when many “world tourism hits” experience no less difficulties than Russian routes and destinations.
And in conclusion, again about China. China was the first to enter the coronavirus crisis, and the first to emerge, articulating, among other things, new prospects for the tourism industry. As noted by A. Maslov, “China has revived. Sales of cosmetics have increased by 147% in the country. Ticket orders have increased by 60%. One of the most popular goods for orders in online stores is equipment for travelers, backpacks, tents. This is despite the fact that the Chinese are not lovers of such travel. It turned out that the Chinese missed active life” (Vesti FM: China misses active life). We can assume that Russian residents will feel the same way when self-isolation is over. In addition, “when borders open, we expect a huge inflow of Chinese tourists” (Vesti FM: China misses active life). It is important that by this point the industry feels healthy enough so that the demand for domestic and inbound tourism meets adequate supply in Russia.
Sheresheva Marina Yurievna, Doctor in Economics, Professor, Director of the Center for Network Economy Studies, Head of the Laboratory of Institutional Analysis of the Faculty of Econоmics, Lomonosov Moscow State University. E-mail: m.sheresheva@mail.ru