finance news

UK economy to incur £22B loss due to declining international tourism

UK economy to incur £22B loss due to declining international tourism
UK economy to incur £22B loss due to declining international tourism

The UK economy is expected to register a £22 billion loss in spending due to the rapidly declining demand for international travel and tourism, putting 3 million jobs at risk. These 3 million jobs or employees have relied on or been supported by the travel & tourism industry in the UK.

According to the WTTC (World Travel and Tourism Council), the imposition of travel restrictions to curb the spread of the COVID-19 disease has influenced several people to embrace staycation as a new world. The organization has conducted an impact assessment of the UK economy. As per its estimates, the decline in the number of international tourists could lead to a significant drop in the amount spent by 78% or £420 million per week.

Gloria Guevara, WTTC’s President & Chief Executive, has stated that the considerable drop in travel demand due to the ongoing pandemic is likely to potentially cause a loss of £60 million per day in the UK economy, which could take several years to return to normal. This loss could threaten the position of London as a premier hub for leisure travel and business across the globe.

Guevara criticized the ‘stop-start’ quarantine measures of the UK government as well as the nation’s lack of test & trace initiatives at the international entry points. She further added that these stop-start quarantine measures should be replaced by the cost-effective, comprehensive, and rapid test & trace programs across the country. She predicted that this investment will be relatively lower than the impact of these quarantine measures.

As per reliable reports from the WTTC, the travel & tourism industry is responsible for nearly 4 million jobs across the city, which is 11% of its total workforce. The industry generates around £200 billion per year, representing 9% of the UK economy. The city was also reportedly dependent on international tourism, which represents 85% of the tourism spending in the region.

Source credit:

https://www.theguardian.com/business/2020/aug/26/drop-in-tourism-could-wipe-22bn-from-uk-economy-says-wttc-covid-19