Coronavirus Threatens Tourism Industry In The Caribbean

Travel bans and cancelled airplane flights are damaging the all-important tourism industry across much of the Caribbean.

While Jamaica, the Bahamas and Guyana have postponed their annual carnival celebrations, Puerto Rico, Guadeloupe and Anguilla remained closed to visitors.

Jamaica’s tourism minister, Edmund Bartlett, went so far as to claim the tourism industry was facing “imminent closure.”

“[Travel warnings will] be the deciding factor in hotels, attractions and other tourism entities remaining open or closed,” Bartlett said after the U.S. issued an advisory against travelling abroad. “Survival is the key right now.”

Hotels across Jamaica have closed, throwing thousands out of work.

The Spanish hotel chain RIU, which owns several hotels in Jamaica, said: “We are facing an unprecedented situation that requires us to take exceptional measures.”

Bartlett hopes these closures will only be temporary.

“In fact the entire world is following that position [closing markets for travel]. It is proven that the optimal way to deal with the virus now is to prevent the movement of [people] from one location to the other,” Bartlett said.

World Travel and Tourism Council reported that travel and tourism either directly or indirectly represented 34% of Jamaica's 2018 GDP, 31% of employment and nearly 60% of total exports.

Tourism activity in Jamaica jumped to 4.2 million arrivals in 2019 from 2.8 million in 2010, partly buoyed by investments in facilities and domestic infrastructures like highways.

The United States accounted for 66% of total arrivals in 2018, followed by Canada at 16% and the U.K. at 9%.

After Canada advised its people against overseas travel, the senior strategist in Jamaica’s tourism ministry Delano Seiveright said: “Canada is our second largest market for stopover arrivals, representing roughly 15% of the business. It's a huge blow but expected given current trends globally which lean towards restriction of nonessential travel.”

The Chairman of the Montego Bay Chapter of the Jamaica Hotel and Tourist Association Robin Russell said members of his association have reported waves of cancellations and postponements.

“Right now we have a few bookings but most of our forward bookings are not materializing and also they are being cancelled. People are calling and cancelling their reservations right across the membership,” said Russell, who also manages Deja Resorts in Montego Bay.

Russell thinks layoffs are inevitable.

“I know that there is at least one property in Negril that is already closed. I can [understand] if there is no business, that properties will either have to close or scale down,” he said. “A lot of the larger properties and these tour operators have closed down their operations temporarily [in] Jamaica. The small properties also depend on these tour operators and closing down their operation simply means there is no business. When airlines have cancelled up to 80% of their international flights the destinations are going to be affected.”

John Byles, executive director of Chukka Adventures, said: “The cruise lines… have stopped operations for 30 days; [there are also] travel restrictions worldwide and some [are] our international partners. It's a major shock. We are in the midst of the shock right now, it's going to be [this way] for a period of time.”

Thus far, Jamaica has confirmed 19 cases of the virus and no deaths and imposed air and sea travel restrictions.

“This is a difficult time; we all understand what is happening in the global space and that tourism is the first casualty because of how vulnerable we are to travel. However, the government is taking steps to ensure that there is a cash grant to each person who has lost his or her job as a result of COVID-19,” Bartlett said. “The resilience of tourism makes it able to recover very quickly and grow and do much better than other industries.”

Moody's, the U.S. credit rating agency, offered some hope by citing that Jamaica's large primary surplus and sufficient international reserves will allow the government to alleviate losses suffered by its tourist industry.

“While we expect growth to slow from declining tourist arrivals, the effect on Jamaica's external accounts will be partially offset by the high import content of tourism earnings, which will reduce the country's import bill. Moreover, lower oil prices will also have a positive effect on Jamaica's current account,” Moody's said. “We believe that the country has sufficient fiscal and external buffers to cope with a shock in the tourism industry, limiting the immediate credit negative effect.”

Tourism accounts for more than 15% of the Caribbean’s annual gross domestic product. The sector was already reeling from hurricane damage even before the emergence of the coronavirus.

“An overall contraction in domestic short-term economic growth is inevitable,” said the Bahamas deputy prime minister, Peter Turnquest.

Cuba has essentially shut down its tourism sector for one month by banning most air travel arrivals to the island for at least 30 days.

Miguel Díaz-Canel, the president of Cuba, encouraged the 60,000 tourists currently in the country to leave the country immediately.

Cuban Prime Minister Manuel Marrero said most government-run hotels will close by next week and that hotel workers who lose their jobs will be transferred to other state-owned enterprises.

Cubs has confirmed 21 cases of the virus – one of them, an Italian tourist, has died.

Cuba received about 4 million tourists last year, a drop from 4.7 million the prior year.

The Dominican Republic’s tourism sector will suffer an “intense fall” due the coronavirus pandemic, warned, Frank Rainieri, president of Puntacana Group, a resort and residential community.

Rainieri said both the country and tourist industry “will suffer the consequences of an intense drop in tourist activity which will bring about a difficult situation for all.”

In 2019, the Dominican Republic generated income of $11 billion from tourism, supporting more than 300,000 jobs.

Three of the biggest sources of tourism, Spain, Italy and the U.S. have imposed travel bans and facing their own health emergencies.

“We have a weakness, this [virus] is a disease that has not been generated [within] the country that until now has not spread, but we have an enormous risk, because this country, its main economic activity is tourism,” said the Administrative Minister of the Presidency, José Ramón Peralta