The tourism sector in Spain will lose more than 100,000 million euros due to the health crisis

aware October 22, 2020 at 07:45 pm

by
AFP

Madrid, Spain – Devastated by the pandemic, the all-important Spanish tourism sector is expected to incur losses of more than 100 billion euros ($ 120 billion) this year, an industry body warned on Wednesday. If the dire prediction is correct, the sector’s annual revenues would return to the level they were in 1995, said tourism association Exceltur. “We would go back 25 years in terms of what the Spanish tourism sector generates,” said José Luis Zoreda, vice president of the association, at a press conference, noting that it would be a “dire scenario.” Exceltur has been forced to further amend its annual predictions after regional authorities tightened restrictions to curb the virus that has claimed some 34,000 lives and infected nearly a million people, the highest number in the EU. Since the beginning of October, the Spanish capital and about a dozen nearby towns have been partially closed, and throughout the northeast region of Catalonia, bars and restaurants have been closed for fifteen days. Including the impact of the latest restrictions, which Exceltur estimates will cost almost 7.5 billion euros, the sector’s annual losses are expected to rise to 106 billion euros by the end of the year.

After an initial three-month shutdown at the start of the pandemic, the industry then suffered a catastrophic summer with tourists avoiding Spain before taking another hit from October’s restrictions, with annual turnover plummeting 70 percent in last year’s figures. Tourism is of great importance for the Spanish economy, since it represents around 12 percent of gross domestic product (GDP) and 13 percent of employment. Zoreda said that the government had not fully understood the scope of the crisis affecting the industry and said that “an urgent rescue plan was needed … that included direct help” in line with the bailouts granted to the banking sector during the financial crisis. In June, the government of Socialist Prime Minister Pedro Sánchez announced a rescue package of 4.2 billion euros for the devastated tourism sector, but the funds largely amounted to state-sponsored loan guarantees, a moratorium on payments. lower mortgages and airport fees for airlines. . Although Spain will be one of the main beneficiaries of the European virus rescue plan, under which it will receive around 140,000 million euros, “we cannot discern a clear prioritization of the tourism sector,” said Zoreda.