Is the travel industry poised for a comeback?
Team Veye | 19-May-2023
Travel and tourism industry, after a ten-year growth spurt, faced a body blow when struck by the pandemic and virtually collapsed. Since most of the countries had shut their borders to all international arrivals and departures, serious travel disruptions ensued.
The industry, though struggling, faced with macroeconomic challenges, were constantly making efforts for an early uplift. The global travel and tourism sector finally saw a silver lining to emerge from a two-year slump, in the lifting of the ban on international cruise ships in April 2022. Cruise being an important part of leisure sales.
The revival could have started earlier, but for economic downturn, sanctions on Russia and, most of all, China’s zero-covid policy weighing heavily on the industry.
Now, with most of the countries lifting pandemic restrictions, pent up demand is witnessing a large number of people travelling internationally.
Some travel agencies are already propagating about this being the best time to book a vacation, as international flight prices are just beginning to climb with travel rebounding.
Demand in both leisure and corporate travel is growing. Although, it is still at a relatively early stage on the path to recovery, since there is considerable pent-up demand that is yet to flow through and not fully translating to travel.
With China opening for travel, mass outbound tourism from China is expected to resume soon. The resumption of Chinese travel will boost the recovery of long-haul travel market share in 2023.
China opening can also create a significant recovery in airline supply, resulting in much-needed competition in international airfare prices and capacity This can set the sector in good momentum and lead to a strong 2024.
Historically also, downturns in travel demand have tended to be short-lived, followed by periods of strong growth.
According to World Travel and Tourism Council, the global travel and tourism sectors are projected to return to pre-pandemic levels in 2023 and grow at a rate that would outrun global gross domestic product (GDP) growth.
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