Projections about the economic impact from Covid-19 are
grim, but one new report has a silver lining.
Oxford Economics says that while the world is likely sinking
into a global recession that will result in a more than 10% drop in
international travel, the recovery should be fast.
“Once the situation has stabilized, we expect a rapid
recovery since travel demand has proven resilient in bouncing back from
downturns in the past,” the research firm said. “Travel levels are expected to
fully recover by 2023.”
Oxford says the U.S. is already in recession. It anticipates
1 million layoffs and a total loss to the U.S. gross national product (GNP) of $350 billion.
“Attention is understandably focused on limiting the damage
from the short-term effects of the coronavirus outbreak. But it’s likely that once
disruption and uncertainty fade, the rebound in global economic activity will
be strong,” Oxford Economics said. “It’s important for firms to position
themselves for such a recovery.”
The group said historical evidence supports its analysis,
noting that over the last 200 years, short recessions have typically been
followed by robust recovery.
“Long-term impacts from natural disasters have generally
only been evident for specific hazards,” Oxford said. “With the notable
exception of AIDS, longer-term pandemic effects also appear to have been
As with other economic impact reports, the group noted that
travel bans and other mandates to prevent the spread of the virus will impact
the travel and tourism industries most heavily. “An unprecedented fall in
global travel is now likely in 2020,” Oxford said.
Asia-Pacific will be the hardest hit region, with a 15.4%
decline in visitor arrivals for 2020, Oxford forecasted. That’s 55 million
fewer arrivals than 2019. European inbound travel is forecast to decline 9.7%
in 2020 — 72 million fewer visitors than last year. And travel to North
America is expected to decline 10.9% in 2020, for an expected loss of 16
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