Tourism hard hit by COVID-19

THE tourism sector in Barbados has been hard hit by the novel coronavirus (COVID-19) pandemic and will likely see a late recovery, even after the country emerges from the current crisis.

Minister in the Ministry of Economic Affairs and Investment, Marsha Caddle, suggested the above as she spoke during a Zoom Webinar hosted by the IDB, entitled “Policies to Fight the Pandemic: Barbados in Focus”, which took place yesterday morning. The IDB acknowledged that with the spread of COVID-19, the macroeconomic outlook for Latin America and the Caribbean has changed dramatically and therefore, the Bank sought to have some analysis and discussion on policy recommendations that could bring relief and maintain economic stability for Barbados, the Caribbean and Latin America.

Looking at the impact the pandemic has had on Barbados and other similar tourism-based economies, Caddle said, “This has had its biggest impact on tourism. Tourism for Barbados employs 36 to 40 per cent of people here and has a similar contribution to GDP.”

“We don’t know when the cycle of recovery is going to start, but we know that tourism is probably going to be late in the sequence of recovery, as people start to take time to be comfortable with air and cruise travel; as people start to rebuild their savings and so on,” she noted.

In giving an overview of the impact on the tourism sector, Caddle pointed out that by early March, 2020, revenues in the sector fell to zero for us here and the industry began laying people off. This in turn has had an effect on the country’s unemployment figures.

“So between March 23rd and April 23rd, unemployment claims at National Insurance rose by about 24,500 and that is about 18 per cent of our workforce, mainly from the tourism sector, but as others said before, that is not going to be the only impact because the physical distancing requirements are going to mean that economic activity of all kinds is contracting, even outside of the sector,” Caddle maintained.

“In terms of the tourism sector itself, we are negotiating for the public health protocols that would be in place at such a time as we are able to return to flights, such as every passenger having to carry out a rapid test and getting the results before boarding a flight. It may be possible for flights to return by July, if we start to look very carefully and closely and seriously at some of these protocols, but while we (hope for) the best, we have to plan for the worst,” Caddle said, acknowledging that it may be a slow return for the sector, with economic gains coming at a much later date. (RSM)