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Covid-19 recovery

France boosts support for tourism as Covid eats €270bn out of global sector

Lockdown measures stifled economic activity in France, in particular the crucial tourism industry.
Lockdown measures stifled economic activity in France, in particular the crucial tourism industry. © AFP/File
3 min

The French government is to continue furlough measures in the tourism sector, which has been particularly hard hit by the coronavirus pandemic. On Tuesday the UN’s world tourism body said Covid-19 fears had cost the global sector 320 billion dollars (273 billion euros) in the first five months of 2020.  

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Companies working in the hotel, restaurant, travel and events sectors, among others, have been benefiting from the government measures since May. 

They had been set to end in September, but on Wednesday the government announced plans to continue the system of “temporary unemployment” – whereby the state pays companies to keep their staff on the payroll while not working –through to December.

“It's clear that tourism professionals need long-term support,” secretary of state for tourism, Jean-Baptiste Lemoyne told France Info radio.

“For some it will be a lost year. We’ll see how things are in September, but in principle, we will continue to furlough until December.”

France's tourism sector generates nearly eight percent of the country's economic output and employs some two million people.

In May, the government rolled out an 18 billion euro rescue plan which included state-backed loans, caps on social charges and deferred tax payments.

Companies working in the sector had already received "close to nine billion euros in government-guaranteed loans", Lemoyne said.

Economic catastrophe

Tourism industry representatives want the government to go further.

“We will have to prolong financial support for our profession," Jean-Virgile Crance, head of a group representing hotel chains (GNC), told AFP. "If not, lots of hotels will close. It will be an economic catastrophe for the tourism sector.”

Crance had been pushing for the measures to continue at least until April 2021.

“With Umih (the main hotel federation), we estimate that more than 20 percent of hotels could go under by the end of the year if the economic situation continues,” he added.

The big wheel of Berck-sur-Mer is turning again, but hardly any people are using it.
The big wheel of Berck-sur-Mer is turning again, but hardly any people are using it. © RFI/Jan van der Made

Global tourism crisis

The French government’s undertaking followed a UN announcement that the coronavirus crisis has cost the global tourism sector 273 billion euros in lost revenue during the first five months of 2020.

Losses between January and May are "more than three times the loss during the Global Financial Crisis of 2009", the Madrid-based United Nations World Tourism Organization (UNWTO) said in a statement.

International tourist arrivals fell by 300 million – or 56 percent – in that period as lockdown restrictions to control the spread of Covid-19 came into effect.

"This latest data makes clear the importance of restarting tourism as soon as it is safe to do so. The dramatic fall in international tourism places many millions of livelihoods at risk" said the body's secretary general, Zurab Pololikashvili.

While tourism is slowly returning in some destinations, UNWTO warned the sector still faces serious risks, such as a resurgence of the virus that could trigger new lockdowns, more travel restrictions and border closures.

The United States and China, both major sources of international tourists, are still "at standstill" it added.

The UN body forecast in May that international tourist arrivals could plunge by 60 to 80 percent in 2020 owing to the coronavirus.

International tourism arrivals rose by four percent in 2019 to 1.5 billion, with France the world's most visited country, followed by Spain and the United States.

While European visitors have partly made up for the loss of visitors from the Americas and Asia, most of France's hospitality businesses and cultural sites are still suffering, with visits to the Louvre museum down 60 percent. 

 

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