ITIC Says Tourism Industry Might Not Return To 2019 Levels Of Activity Until 2029
The Irish Tourism Industry Confederation (ITIC) said at its online "Leading the Tourism Recovery - ITIC Virtual Conference 2021" event on Wednesday February 10 that activity in the tourism industry might not return to 2019 levels until 2029 in a worst case scenario.
However, as reported by rte.ie, ITIC chairperson Ruth Andrews said that this is not a prospect on which ITIC is focussing, and it is hoping that the sector will recover much sooner than 2029.
Andrews stated, "The most optimistic that we need to look towards is when we can get back to those 2019 levels of business, when we can get back to creating those numbers of jobs again, and we do envisage that is possible by 2025 to 2026.
"But it is going to be contingent on the government continuing to commit to tourism and continuing to invest."
ITIC launched a recovery plan for the tourism sector during the "Leading the Tourism Recovery - ITIC Virtual Conference 2021" event, which includes three scenarios, one of which is titled "downside", one of which is titled "through to base case", and one of which is titled "optimistic".
The three scenarios are dependent on variables such as how quickly COVID-19 vaccines are rolled out, the implementation of safe travel protocols, connectivity availability, the strength of the global economy and the return of demand.
In the "downside" scenario, the roll out of vaccines would be delayed, there would be a low take up of vaccines or vaccines would be ineffective. In this scenario, the number of overseas tourists who travel to Ireland would increase from an estimated 1.8 million in 2021 to 7.45 million in 2025.
9.69 million overseas tourists travelled to Ireland in 2019.
In the "through to base case" scenario, the number of overseas tourists who travel to Ireland would increase to 9.2 million by 2025, and in the "optimistic" scenario, the number of overseas tourists who travel to Ireland would increase to 10.5 million by 2025.
Policies Needed To Help Hospitality And Tourism Businesses Survive
As reported by Hospitality Ireland in January, ITIC believes that the following policies are needed to help hospitality and tourism businesses survive the COVID-19 pandemic:
- an urgent roll-out of a vaccination programme and the publication of key milestones;
- a doubling of the COVID Restrictions Support Scheme (CRSS) and an extension of the scheme to all tourism businesses with the removal of the current cap;
- an extension of the Employment Wage Subsidy Scheme at current levels for the rest of 2021;
- a doubling of tourism budgets, including business continuity grants, marketing funds and upskilling programmes;
- a relaunch and redesign of the Stay & Spend Scheme as a consumer-friendly voucher;
- an extension of the waiver on local authority rates for all of 2021;
- the introduction of a cost-effective, rapid and scalable COVID-19 testing regime for international travellers;
- a continuation of VAT at 9% with no review until 2025;
- and a six month moratorium on bank loans for businesses and mortgages for tourism employees.
Andrews said that the CRSS and wage supports will be vital for the industry, and need to be extended far beyond the end of 2021 to provide security, and that the 9% VAT rate is of little or no value if it ends this year.
Andrews also said that supports need to be sector specific because even though other parts of the economy have closed down due to the pandemic, they have not been hit as badly as the tourism sector.
Andrews is expecting recovery to be V-shaped in terms of demand when it arrives.
Tourism Minister Statements
Tourism minister Catherine Martin told the "Leading the Tourism Recovery - ITIC Virtual Conference 2021" event, "The government remains absolutely committed to ensuring that the aviation sector can maintain the necessary core capability to retain that strategic connectivity and is ready to quickly rebound when the time is right to do so…The reduction from the 13.5% to 9% rate that we achieved in the last budget, it is the most targetted, the most focussed and of most benefit to the sector.
"What I can say is that I am very aware of that and my focus is on that."
Martin said that she is working to deliver additional supports to tourism businesses, including the CRSS, two thirds of the payments of which have gone to tourism companies, as well as the €55 million of supports being delivered through Fáilte Ireland.
She stated, "The key is there will be no cliff-edge, and I have worked with [finance] Minister [Paschal] Donohoe and the Tánaiste on this, and there will be no cliff-edge for this industry.
"It is about putting the right supports in place to survive."
When asked if she is disappointed by reports that some Irish residents are continuing to travel overseas despite guidelines stating that they should not do so, Marin responded, "Well of course, because you would hope for solidarity when a nation and so many businesses are suffering and people are going through that financial and personal hardship."
Martin said that the government's main objective has to be to minimise the introduction of the virus from other locations to Ireland and, in relation to inbound tourism, that is difficult at present.
She stated that stronger measures are being put in place, and said, "I think that is the way the government is moving right now."
Martin added that the government will be ready to promote Ireland overseas as soon as the time is right to do so, and that she is reasonably optimistic about a recovery in the domestic tourism economy, but is also very aware that three quarters of that consists of international visitors, and stated, "Our focus now is on suppressing the virus and making sure that domestic tourism is at best as it can be in the summer."
© 2021 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.