How the coronavirus is wrecking Brazil’s tourism industry

. May 17, 2020
tourism coronavirus brazil Once Brazil's third-busiest hubs, Brasília's Juscelino Kubitscheck Airport is nearly empty. Photo: Marcello Casal Jr/ABr

The Brazilian tourism industry had high hopes for 2020. According to the Travel Trends 2020 report, by Scottish travel platform Skyscanner, Brazil was one of the top 3 emerging destinations, with a 27-percent increase in global searches and bookings from 2018. Experts predicted that the loosening of visa policies to make life easier on travelers would begin to pay off, and projected a rise in revenue for the sector.

But then came the Covid-19 pandemic. Roughly 4 billion people in the world are currently under some sort of social isolation measure — or even strict lockdown — and nearly all flights have been grounded.

</p> <p>For Brazil, the impact will be devastating. The sector represents almost 4 percent of the country&#8217;s GDP and employs some 7 million people, creating revenue for people from all social sectors. A study by think-tank Fundação Getulio Vargas <a href="">estimated</a> losses for the 2020-2021 period at BRL 117 billion (USD 20 billion).&nbsp;</p> <p>To compensate for the losses, it will take no less than a 17-percent annual growth rate in both 2022 and 2023 — which, considering the economic crisis Brazil is facing, won&#8217;t be easy. Not by the slightest. And that’s not to mention that we have no idea how long this crisis will last for.</p> <h2>Uncertainty for travelers and operators</h2> <p>Gislaine Navas, 38, had her suitcases packed for a trip with her husband to the northeastern coastal city of Jericoacoara between April 29 and May 2. But she had to stay home, as Brazilian states started enforcing quarantine rules as Covid-19 cases started to rise. &#8220;I got an email from the airlines saying I could postpone for up to a year, but I eventually decided to reschedule the trip to July, cost free. Should I have canceled it, I would have paid a fine,&#8221; she says.</p> <p>For Douglas Coca, 42, things were much less smooth. He bought a vacation package for Porto de Galinhas, a beachfront paradise in Pernambuco, with travel platform Decolar. He was hooked up with multiple providers —&nbsp;for car rental, airline tickets, and accommodations. Now, he is finding it impossible to coordinate with all services a new date. &#8220;Before getting new flights, I must get new hotel bookings — but the platform simply doesn&#8217;t allow me too,&#8221; he told <strong>The Brazilian Report</strong>.</p> <p>For tourism service providers, things are not much better. In many regions, such as the Fernando de Noronha archipelago, the sector is the core economic activity.&nbsp;</p> <p>The 21 volcanic islands are filled with <a href="">picture-perfect beaches</a> and turquoise waters — making up one of the most beautiful destinations in Brazil. It is home to 3,300 people who live off tourism — but trips have been forbidden since March 24. &#8220;Nobody can come here, and people were in lockdown between April 20 and May 10, and beaches are closed until May 31. Only people with government authorization can leave their homes, and police intercept non-compliant residents,&#8221; said innkeeper Rodrigo Valença.</p> <p>The archipelago is under a special political administration attached to the state of Pernambuco, which is offering basic baskets of necessities and a BRL 200 monthly emergency aid benefit per family, to pay for utility bills. &#8220;We are fighting to free the islands from the virus. Reopening tourism now would be a mistake,&#8221; said Mr. Valença.</p> <p>Fernando de Noronha had <a href="">28 confirmed Covid-19 cases</a> — all recovered&nbsp;— and is currently monitoring five suspected infections.</p> <figure class="wp-block-image size-large"><img loading="lazy" width="1000" height="667" src="" alt="fernando de noronha marcioenrique" class="wp-image-39504" srcset=" 1000w, 300w, 768w, 610w" sizes="(max-width: 1000px) 100vw, 1000px" /><figcaption>Fernando de Noronha: beaches closed at least until May 31. Photo: Marcio Enrique/Shutterstock</figcaption></figure> <h2>What it will take to lift the tourism sector back to its feet</h2> <p>To avoid a full-scale collapse of the tourism industry, governments must step in. &#8220;Public aid will be essential to keep the sector alive, with special credit lines — especially for the aviation sector, which is the heart of the industry,&#8221; said a Fundação Getulio Vargas report. That has to been done by the federal government.</p> <p>On Friday, Gustavo Montezano, head of Brazil’s National Development Bank, announced a deal to bail out Brazilian airlines through a package that may reach up to BRL 6 billion. Mr. Montezano stated during the bank&#8217;s Q1 earnings conference that the country&#8217;s three largest airlines (Gol, Latam, and Azul) accepted the plan&#8217;s conditions, which include the obligation to direct their resources towards their Brazilian operations — not to financial creditors — and to have equal conditions for all companies.</p> <p>&#8220;Due to the pandemic, we have reduced our operation by 90 percent between March and April. We are now flying only 70 daily routes to 27 cities —&nbsp;from a normal rate of 920 daily flights to over 100 destinations,&#8221; said Marcelo Bento Ribeiro, an institutional relations director at Azul. &#8220;The aviation sector has high overheads and employs highly-specialized workers&nbsp;— which makes it impossible for companies to drastically cut costs. That has seriously compromised our balances. We urgently need liquidity to weather the crisis,&#8221; said Mr. Ribeiro.</p> <p>But while the big airlines are being taken care of, the government must not forget small companies — who make up for the majority of the industry&#8217;s players. Experts advise in favor of increasing subsidized credit and aid packages for businesses that choose not to lay off workers.&nbsp;</p> <h2>The (near) future of tourism is domestic</h2> <p>Nobody knows when international trips will be safe again — or how long it will take for countries to lift all travel bans in place at the moment. But it is hard to imagine most people eager to hop onto a jumbo-jet with 400-plus possible virus-carriers. Moreover, a boarding line respecting safe-distancing guidelines (2 meters between each person) would mean lines of about one kilometer each.</p> <p>It is safe to say that the future of tourism —&nbsp;at least until the coronavirus scare is behind us (if it ever will) —&nbsp;will depend on domestic travel. For Brazil, the shock will not be that drastic, as the country has always been <a href="">overlooked by international travelers</a>. The country attracts merely 6 million foreign tourists per year, mostly from South America.&nbsp;</p> <p>That&#8217;s fewer travelers to the entire country than the <a href="">Eiffel Tower</a> alone.

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Beatriz Farrugia

Beatriz Farrugia has ten years of experience working for international news agencies. She is a former editor at ANSA and holds a post-graduate degree in International Relations from Fundação Getulio Vargas

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