Back in March, Morgan Stanley predicted another lost summer for tourism, surprising some, given the vaccine optimism at the time. Now in August, when beaches and cities are normally packed with holidaymakers, their call looks bang on.
Spain welcomed 75% fewer tourists last month than in June 2019. Greek islands, billed as “COVID-free”, are coming under travel curbs again, as well as suffering wildfires. Thailand’s Phuket has just 1% of the visitors it had before the pandemic. Turkey’s second-quarter tourism revenues were $3 billion, versus $8 billion in Q2 2019, while Kenya welcomed just 300,000 visitors in H1 compared to 2 million in 2019.
Given that tourism directly contributes 6% of European GDP and nearly 8% of employment, it’s unsurprising the euro zone services business expectations index has slipped to three-month lows and European travel shares have lost 13% since April. The Thai baht has slumped to its lowest since 2018. It’s enough to make you need a holiday.