Tourism industry suffering from impact of Covid-19
THE COVID-19 pandemic is already affecting the local tourism sector, with Minister of Finance Camillo Gonsalves reporting on Tuesday that several hotels here are already feeling the impact.
“I called around yesterday, there are some hotels in St Vincent and the Grenadines currently with zero occupants, not a single guest in the hotel.
“And obviously, hoteliers can only keep staff on for so long if nobody’s in there paying for the rooms,” the finance minister told reporters at Cabinet Room.
A call to the Villa based Mariners Hotel revealed that while their occupancy has been affected, they are still doing well. The nearby Sunset Shores Beach Hotel noted there have been a few cancellations as is happening at most of the hotels on the island.
Manager at the Young Island Resort Bianca Porter said the pandemic has drastically affected the resort and while they are not yet empty, they are getting there. “Basically, all forward bookings have been cancelled at this stage at least from now through the end of April as a start.
“Cancellations are coming in daily because persons are faced with travel restrictions because of COVID 19,” Porter told SEARCHLIGHT.
She added also that it would be difficult for the resort to operate at full staffing with no occupancy.
Speaking on COVID-19, the finance minister said there is potential for severe economic upheaval for not only the Vincentian economy but the regional economy.
He noted that over the past days, he and other finance ministers held a number of meetings with member states of the Organization of Eastern Caribbean States (OECS), Caribbean Community (CARICOM), the International Monetary Fund (IMF), representatives of the cruise industry, and other tourism stakeholders.
He said the majority of the countries in CARICOM are heavily dependent on tourism and if you take out Trinidad and Tobago, Guyana and Suriname, which are commodity exporters, and Haiti which has a different economic structure, the Gross Domestic Product (GDP) of all the other CARICOM members is at least one third dependent on tourism.
He said that a meeting with the the governors of all the central banks in the CARICOM region over the weekend, spoke of an estimated 20 per cent fall off in tourism to an 85 per cent fall off in the immediate term. The Minister said if between one third and two thirds of one’s economy is based on tourism, and tourism declines by 50
per cent or 80 per cent, it is not difficult to figure out the significant impact on the economy.
He said the central bank governor suggests that the CARICOM region is going to face billions of dollars in economic losses as a result of the decline in tourism alone.
The Minister said prior to Covid-19, the sub-region was expected to experience growth of about three and a half per cent this year. But based on different scenarios, the best case is that the region will fall from the growth initially projected down to two per cent growth, while in the event of a global recession, the economies of the region will contract.
“So there’ll be no growth, we will shrink by about two per cent. We begin the year thinking we will grow at three and a half percent in the region,now we’re facing the possibility that we may shrink by two per cent.
“So that’s a five and a half percent swing in the wrong direction and we haven’t had a projected swing of that sort since the advent of the global economic and financial crisis in 2008,” Gonsalves explained while adding that this is a significant.
He noted also that as it relates locally to tourism arrivals, he has been advised that 80 per cent of the remaining cruise ships that were expected in SVG in 2020 have cancelled.
“The global cruise ship lockdown will mean displacement for thousands of Vincentians who work on cruise ships. Estimates are that about 2500 Vincentians, more or less, work on cruise ships globally.
“Hundreds of those will be coming home because the cruise ships have shut down, and hundreds of them will be coming home without a job and those 2500 people send remittances home for the family as a result of their work on cruise ships, and those remittances may well, slow to a trickle in this immediate aftermath,” Gonsalves predicted.