The outbreak of Covid-19 last year has hit tourism like a ton of bricks, with many countries across the globe experiencing a massive slowdown in the industry. For example, Germany’s tourism sector lost an astronomical €161 billion in 2020 alone, states the website http://www.fitformoney.de. Now, Portugal’s tourism industry is bracing for the full impact of the pandemic.
A recent report by the global consultancy McKinsey states that the slowdown in tourism could cost Portugal around €60 billion in GDP by the time the industry is estimated to recover from the impact of Covid-19 in 2023. This is a whopping 26 percent of the country’s GDP in 2019. In addition, up to 600,000 jobs in the sector will be lost. This translates to roughly 600,000 people losing their livelihood. It is also predicted that many of these jobs will not be recovered.
This is a concern since tourism makes up 18.6 percent of Portugal’s total job number. And in areas such as Algarve, Azores and Madeira, this number stands at over 20 percent. But this is not all. The research also looks at more indirect effects of the decline in tourism on other sectors “which depend on this traffic to stay afloat, such as shopping centers, restaurants and retailers.”
“While it is impossible to predict when the sector might show signs of recovery, there are many measures that the sector’s ‘players’ could be developing in the immediate term … for a faster and more sustainable recovery,” states the consultancy. Some of these include digitalization to make companies more competitive and collaboration within the tourism sector.
The report also points to some other important factors that could influence how quickly the country recovers from the slump. Some of these are the appeal of the particular destination in question, quality of healthcare, as well as focus on sustainability and business travel.
In addition, the Mckinsey report highlights that some tourist areas are likely to recover faster than others. These include eco-tourism, cultural tourism, religious tourism and cultural tourism. On the other hand, areas that are likely to take longer to recover include cruise travel, group and solo travel, urban tourism and event tourism, which encompasses meetings, exhibitions and conferences.
Late last year, Portugal’s Tourism Secretary Rita Marques expressed her concern that some regions of the country such as Algarve are overly dependent on tourism - and particularly tourists from the UK - for income. “We need to diversify... but we will work to guarantee the Algarve continues to welcome all British people - no matter what happens with Brexit,” Marques said.
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The Government of Portugal, could take a look at how the UK has promoted Britain over the years, with great success. This has produced many jobs in the tourist industry and auxiliary industries, like food, alcohol, cafes, restaurants, car hire, tour guides, florists and the list goes on.
However, as a Brit if I have to say that the UK offers an abundance of castles but not much sun.
Perhaps they need to promote niche holidays more - wine tours, painting, build a Disneyland. Or maybe manufacture more to reduce reliance on tourism.
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My point is, that Portugal's revenue from Tourism, is 11% per annum, which means that 89% of Portugal's revenue is coming from other sources.
We forget that Tourism in the Algarve is an industry that generates most of the 11% revenue for the entire country, because this is where most tourists (foreign and local) tend to gravitate towards.
However, there is much more to see, like the wonderful Castles and fortresses of North Alentejo or the Minho region, with medieval towns like Ponte Lima.
But, tourists will not get to see these beautiful places, because the Government neglects to showcase Portugal to an international audience.
What is probably needed, is an advertisement blitz to highlight Serra Estrella (Winter skiing) or just a beautiful drive to the top, or the Castles of Northern Portugal. Maybe, just may, Tourists revenue could take in 30% or 40% of GDP, that would be great news for the country.
You miss my point Brook, and in doing so prove it. My observation was that I was surprised the percentage of tourist revenue was not much higher in Portugal than the UK considering it is so dependent on tourism.
The fact that UK GDP is far more than Portugal's means that in monetary terms Portugal is further behind than percentages indicate.
I may try paying for my shopping in percentages at Pingo Doce
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Meaningless, it is not, as UK has a larger population, the 11% GDP will bring in 11% of Revenue from the total GDP of the country and the same refer's to Portugal GDP.
I'm surprised that Portugal's percentage isn't significantly higher than the UK's in 2018 given their reliance on tourism. But it is fairly meaningless anyway with the UK GDP being far higher than that of PT.