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- ECONOMIC IMPACT -

Latest update: 25 August 

Many economists have cut their GDP forecasts. The 2020 consensus forecast for GDP growth is currently negative and many predict a recession.

The UK Government's spending on virus measures has pushed its debt to £2tn, according to the Office for National Statistics.

-3.9%

Consensus forecast for world GDP growth in 2020 is -3.9%.

$375bn

According to the IMF, the pandemic has cost an estimated $375bn a month globally.

Impact of Covid-19 on EQUITY INDICES

- SECTOR IMPACT: TRAVEL AND TOURISM -

Latest update: 12 August 

Construction market impact

98%

of IHG hotels in China have reopened, while most construction work on IHG hotels in the country has also restarted.

37.9%

Spending will fall broadly in line with the decline in tourism flows. GlobalData forecasts that inbound expenditure globally will fall by 37.9% in 2020. 

Demand Disruption

On 8 June, England introduced a 14-day quarantine for people arriving in the country. The move sparked a legal challenge from the industry. However, in early July, England announced that 70 countries and territories are exempt from quarantine requirements. There are some notable exclusions, most notably China, Portugal and the US. 

Travel & Tourism mitigation strategies

Short term (six to 12 months)

Covid-19 has hit the tourism industry hard. While it is predicted that 2020 will bear the brunt of disruption, it is impossible to say when travel will return to 2019 levels. Over the coming months, players at all stages of the value chain will need to focus on survival.


For the hotel industry, this may require decision makers to implement cost-cutting measures and/or secure credit and government funding. Hoteliers should also focus on promoting high hygiene standards to instil confidence in potential guests.


Mid-term (one to three years)

Looking forward, hoteliers should prepare for a change in customer behaviour. Covid-19 may change the way that travellers see the world and hotel owners and managers will need to adapt swiftly. 


Consequently, decision makers should assess how demands and expectations may change and adjust their product and marketing strategies accordingly. For example, by investing in marketing campaigns to entice international visitors or tapping into the momentum that domestic tourism gained during global travel restrictions.


Long-term (three to five years)

One key challenge that hotels face is the possible long-term shift to reduced business travel as people have become more confident in videoconferencing.


However, customer behaviour will not be static so hotels should continue to re-evaluate and adapt branding and services.

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