UNWTO | 25th March 2022
International tourism continued its recovery in January 2022, with a much better performance compared to the weak start to 2021. However, the Russian invasion of Ukraine adds pressure to existing economic uncertainties, coupled with many Covid-related travel restrictions still in place. Overall confidence could be affected and hamper the recovery of tourism.
Based on the latest available data, global international tourist arrivals more than doubled (+130%) in January 2022 compared to 2021 - the 18 million more visitors recorded worldwide in the first month of this year equals the total increase for the whole of 2021.
While these figures confirm the positive trend already underway last year, the pace of recovery in January was impacted by the emergences of the Omicron variant and the re-introduction of travel restrictions in several destinations. Following the 71% decline of 2021, international arrivals in January 2022 remained 67% below the pre-pandemic levels of 2019.
Europe and Americas perform strongest
All regions enjoyed a significant rebound in January 2022, though from low levels recorded at the start of 2021. Europe (+199%) and the Americas (+97%) continued to post the strongest results, with international arrivals still around half pre-pandemic levels of January 2019 (-53% and -52%, respectively).
The Middle East (+89%) and Africa (+51%) also saw growth in January 2022 over 2021, but these regions saw a drop of 63% and 69% respectively compared to 2019. While Asia and the Pacific recorded a 44% year-on-year increase, several destinations remained closed to non-essential travel resulting in the largest decrease in international arrivals over 2019 (-93%).
By subregions, the best results were recorded by Western Europe, registering four times more arrivals in January 2022 than in 2021, but 58% less than in 2019.
Additionally, the Caribbean (-38% lower than January 2019) and Southern and Mediterranean Europe (-41%) have shown the fastest rates of recovery towards 2019 levels. Indeed, several islands in the Caribbean and Asia and the Pacific, together with some small European and Central American destinations recorded the best results compared to 2019: Seychelles (-27%), Bulgaria and Curaçao (both -20%), El Salvador (-19%), Serbia and Maldives (both -13%), Dominican Republic (-11%), Albania (-7%) and Andorra (-3%). Bosnia and Herzegovina (+2%) even exceeded pre-pandemic levels. Among major destinations Turkey and Mexico saw declines of 16% and 24% respectively as compared to 2019.
Prospects for recovery
After the unprecedented drop of 2020 and 2021, international tourism is expected to continue its gradual recovery in 2022. As of 24th March 2022, 12 destinations had no COVID-19 related restrictions in place and an increasing number of destinations were easing or lifting travel restrictions, which contributes to unleashing pent-up demand.
The war in Ukraine poses new challenges to the global economic environment and risks hampering the return of confidence in global travel. The US and the Asian source markets, which have started to open up, could be particularly impacted especially regarding travel to Europe, as these markets are historically more risk averse.
The shutdown of Ukrainian and Russian airspace, as well as the ban on Russian carriers by many European countries is affecting intra-European travel. It is also causing detours in long-haul flights between Europe and East Asia, which translates into longer flights and higher costs. Russia and Ukraine accounted for a combined 3% of global spending on international tourism in 2020 and at least US$ 14 billion in global tourism receipts could be lost if the conflict is prolonged. The importance of both markets is significant for neighbouring countries, but also for European sun and sea destinations. The Russian market also gained significant weight during the pandemic for long haul destinations such as Maldives, Seychelles or Sri Lanka. As destinations Russia and Ukraine accounted for 4% of all international arrivals in Europe but only 1% of Europe’s international tourism receipts in 2020.
Economic uncertainty and pressures
Even though it is too early to assess the impact, air travel searches and bookings across various channels showed a slowdown the week after the invasion but started to rebound in early March.
It is certain that the offensive will add further pressure to already challenging economic conditions, undermining consumer confidence and raising investment uncertainty. The Organisation for Economic Co-operation and Development (OECD) estimates global economic growth could be more than 1% lower this year than previously projected, while inflation, already high at the start of the year, could be at least a further 2.5% higher. The recent spike in oil prices (Brent reached its highest levels in 10 years), and rising inflation are making accommodation and transport services more expensive, adding extra pressure on businesses, consumer purchasing power and savings, UNWTO notes.
This forecast is in line with the analysis on the potential consequences of the conflict on global economic recovery and growth by the United Nations Conference on Trade and Development (UNCTAD), which has also downgraded its projection for world economic growth in 2022 from 3.6% to 2.6% and warned that developing countries will be most vulnerable to the slowdown.
For UNWTO Tourism Barometer Volume 20 | Issue 2 | March 2022 click file below
Tatiana Rokou / 22nd March 2022
American Express Travel released its highly anticipated American Express Travel: 2022 Global Travel Trends Report which uncovers the latest trends shaping the industry backed by global survey data, American Express Travel proprietary booking data and by insights from travel experts.
Painting a bright state on the future of travel, American Express Travel discovered that spending on travel is outpacing pre-pandemic levels: 86% respondents expect to spend more or the same on travel in 2022 compared to a typical year before the pandemic.
Tourists want to travel more frequently- in fact, 62% of respondents plan on taking 2 - 4 trips in 2022 and 76% of respondents agree they plan to travel more with family in 2022 than they did in 2021.
As travel continues to recover this report looks at the motivations and considerations of travelers in Australia, Canada, Mexico, Japan, India, the UK and the US as well as emerging trends shaping travel.
Top themes discovered in the report include:
The Rise of Impact Travel
SINGAPORE, TTR Weekly| 4 March 2022:
Russia’s invasion of Ukraine launched on 24 February prompted an instant spike in flight cancellations to and from Russia, according to the latest data from ForwardKeys.
On 25 February, the day after the start of the invasion, every booking that was made for travel to Russia was outweighed by six cancellations of pre-existing bookings. The source markets exhibiting the highest cancellation rates, in order of volume, were Germany 773%, France 472%, Italy 152%, the UK 254%, India 285% and Turkey 116%.
The invasion also triggered a collapse in the market for Russian outbound travel. Destinations that suffered the highest immediate cancellation rates, from 24 to 26 February, were Cyprus (300%), Egypt (234%), Turkey (153%), the UK (153%), Armenia (200%), and Maldives (165%).
Before the outbreak of war, Russian outbound flight bookings for March, April and May, had recovered to 32% of pre-pandemic levels, with some holiday hotspots doing exceptionally well.
Mexico led the way with flight bookings 427% ahead of 2019 levels. It was followed by Seychelles 279%, Egypt 192% and the Maldives 115% ahead of 2019 levels.
The outlook for travel was significantly stronger during July and August, as flight bookings stood at 46% of 2019 levels, with destinations like the Maldives 78% ahead, Seychelles 275% ahead, and Egypt 216% ahead.
For some of the countries mentioned above, such as the Seychelles, Maldives and Cyprus, Russian arrivals represent a high percentage of all international arrivals; so, a collapse in Russian travel will have damaging consequences on their tourism-dependent economies.
The countries that currently stand to suffer the most include Armenia, which depends on Russia for 47% of all visitors, Azerbaijan 44%, Uzbekistan 34%, Bulgaria 18%, the Seychelles 16%, the Maldives 15% and Cyprus 13%.
Before the outbreak of war, the top 20 destinations most booked by Russian travellers in March, April and May were, in order of total bookings, Turkey, the UAE, the Maldives, Thailand, Greece, Egypt, Cyprus, Armenia, Seychelles, Sri Lanka, Hungary, Bulgaria, Mexico, Spain, Azerbaijan, USA, UK, Qatar, Italy and Uzbekistan.
Coinciding with the collapse in international air travel, a strong recovery in domestic air travel immediately stalled. Up to 23 February, Russian domestic flight bookings for March, April and May were running 25% ahead of pre-pandemic levels. However, new bookings fell 77%, analyzed on a week-on-week basis.
ForwardKeys, vice president insights Olivier Ponti said: “The outbreak of war always has a hugely damaging impact on the travel industry; and that is what we see here, with mass cancellations in flight bookings to and from Russia.
“The Russian tourism economy was beginning to revive from the pandemic, and it will now experience another substantial blow. There will also be serious impacts on destinations that depend heavily on Russian visitors. The current data does not yet contain the impact of sanctions, which is bound to make the picture worse. Of course, should there be a cease-fire and successful peace talks, the outlook for travel should improve. However, while the economic damage already looks set to be dreadful, it is nothing compared to the human suffering experienced by the people in Ukraine.”
Geneva - The International Air Transport Association (IATA) expects overall traveler numbers to reach 4.0 billion in 2024 (counting multi-sector connecting trips as one passenger), exceeding pre-COVID-19 levels (103% of the 2019 total).
Expectations for the shape of the near-term recovery have shifted slightly, reflecting the evolution of government-imposed travel restrictions in some markets. The overall picture presented in the latest update to IATA’s long-term forecast, however, is unchanged from what was expected in November, prior to the Omicron variant.
“The trajectory for the recovery in passenger numbers from COVID-19 was not changed by the Omicron variant. People want to travel. And when travel restrictions are lifted, they return to the skies. There is still a long way to go to reach a normal state of affairs, but the forecast for the evolution in passenger numbers gives good reason to be optimistic,” said Willie Walsh, IATA’s Director General.
The February update to the long-term forecast includes the following highlights:
“The biggest and most immediate drivers of passenger numbers are the restrictions that governments place on travel. Fortunately, more governments have understood that travel restrictions have little to no long-term impact on the spread of a virus. And the economic and social hardship caused for very limited benefit is simply no longer acceptable in a growing number of markets. As a result, the progressive removal of restrictions is giving a much-needed boost to the prospects for travel,” said Walsh.
IATA reiterates its call for:
Not all markets or market sectors are recovering at the same pace.
“In general, we are moving in the right direction, but there are some concerns. Asia-Pacific is the laggard of the recovery. While Australia and New Zealand have announced measures to reconnect with the world, China is showing no signs of relaxing its zero-COVID strategy.
The resulting localized lock-downs in its domestic market are depressing global passenger numbers even as other major markets like the US are largely back to normal,” said Walsh.
Caribbean: The recovery of traffic to and within the Caribbean has grown slowly relative to other regions and traffic will only reach 92% of 2019 levels by 2024 and not exceed 2019 levels until 2025.
Asia-Pacific: The slow removal of international travel restrictions, and the likelihood of renewed domestic restrictions during COVID outbreaks, mean that traffic to/from/within Asia Pacific will only reach 68% of 2019 levels in 2022, the weakest outcome of the main regions. 2019 levels should be recovered in 2025 (109%) due to a slow recovery on international traffic in the region.
Europe: In the next few years, the intra-Europe market is expected to benefit from passenger preferences for short-haul travel as confidence rebuilds. This will be facilitated by increasingly harmonized and restriction-free movement within the EU. Total passenger numbers to/from/within Europe are expected to reach 86% of 2019 values in 2022, before making a full recovery in 2024 (105%).
North America: After a resilient 2021, traffic to/from/within North America will continue to perform strongly in 2022 as the US domestic market returns to pre-crisis trends, and with ongoing improvements in international travel. In 2022, passenger numbers will reach 94% of 2019 levels, and full recovery is expected in 2023 (102%), ahead of other regions.
Africa: Africa’s passenger traffic prospects are somewhat weaker in the near-term, due to slow progress in vaccinating the population, and the impact of the crisis on developing economies. Passenger numbers to/from/within Africa will recover more gradually than in other regions, reaching 76% of 2019 levels in 2022, surpassing pre-crisis levels only in 2025 (101%).
Middle East: With limited short-haul markets, the Middle East focus on long-haul connectivity through its hubs is expected to result in slower recovery. Passenger numbers to/from/within the Middle East are expected to reach 81% of 2019 levels in 2022, 98% in 2024 and 105% in 2025.
Latin America: Traffic to/from/within Latin America has been relatively resilient during the pandemic and is forecast to see a strong 2022, with limited travel restrictions and dynamic passenger flows within the region and to/from North America. 2019 passenger numbers are forecast to be surpassed in 2023 for Central America (102%), followed by South America in 2024 (103%) and the Caribbean in 2025 (101%).
Source: IATA/Tourism Economics Air Passenger Forecast, March 2022
The forecast does not calculate the impact of the Russia-Ukraine conflict. In general, air transport is resilient against shocks and this conflict is unlikely to impact the long-term growth of air transport. It is too early to estimate what the near-term consequences will be for aviation, but it is clear that there are downside risks, in particular in markets with exposure to the conflict.
Sensitivity factors will include the geographic extent, severity, and time-period for sanctions and/or airspace closures. These impacts would be felt most severely in Russia, Ukraine and neighboring areas. Pre-COVID-19, Russia was the 11th largest market for air transport services in terms of passenger numbers, including its large domestic market. Ukraine ranked 48.
The impact on airline costs as a result of fluctuations in energy prices or rerouting to avoid Russian airspace could have broader implications. Consumer confidence and economic activity are likely to be impacted even outside of Eastern Europe.
Jim Hepple is an Assistant Professor at the University of Aruba and is Managing Director of Tourism Analytics.