The Puzzle of COVID19 Tourism Recovery Funds

The Puzzle of COVID19 Tourism Recovery Funds

Months after countries announced financial stimulus packages to rescue tourism businesses from effects of COVID19 and to restart better, there is little news coming forth on what has been achieved by these funds and/or packages, raising concerns over whether there are challenges standing in the way of realising any meaningful impact from these financial stimulus packages. In our observations it all started with how the industry framed the crisis.

It now appears that several challenges stood in the way of realising any meaningful impact from these financial stimulus packages. It all started with how the industry framed the crisis.

The evolution of tourism responses to COVID19 pandemic and the travel crisis that followed tells an interesting story of how the sector framed the crisis. From focusing on refunds and cancellations to calling for recovery funds, and offering virtual tours; tourism reaffirmed the industry’s fixation with the economics of tourism (arrivals and revenue). The crisis was not framed as a social challenge in destinations. Neither was it addressed as a potential environmental emergency or the health crisis that it is. It was framed more as an economic crisis that required economic solutions.

This framing informed the narrative of economic stimulus packages. This narrative in effective stirred governments to release funds to tourism departments and destination marketing organisations because of the promise of securing the economic worth of tourism. This was the case in a number of African countries.

The recovery funds were set aside to support private sector weather the turbulence of the crisis by restoring attractions (hotels mainly), sustain presence through marketing  as was seen in the emergence of virtual tours and promotions like the “travel tomorrow” campaigns, respond to ‘new normal’ health protocols and build resilience. The was great media attention given to these funds/packages and subsequent press releases in praise of governments for stepping in to rescue tourism brought hope that tourism would build back better. There had been many learning opportunities to guide action.

Several months into the pandemic, little detail is available on the performance of these funds. Are there challenges with implementation /use of these funds? The  observations below could provide answers on why little information is forthcoming on the performance of these economic stimulus packages or recovery funds.

The funds were conceptualised to address risks identified in the early stages of the crisis, and not long term solutions to address inherent weakness in tourism that exacerbated the crisis in a very short time.

The funds gave some destinations as false sense of ‘success’ and took away their focus from addressing significant issues in tourism to an immediate PR messaging with focus on rebuilding destination image as was echoed through many keynotes in webinars.

The funds were announced without much thought on allocation details. In some cases it was not clear whether they would be grants or loans to private sector.

Then selection criteria of beneficiaries was not clear in some countries. Committees were being set up to look at criteria after packages were announced. There was outcry in some countries where allocation conditions were seen as prejudicial.

Focusing on recovery and not resilience has weakened the outcomes of this effort.

Many were emotional responses from tourism representative organisations and public agencies to show solidarity with an industry that had been brought to its knees by the pandemic. This explains why some destinations are yet to disburse the funds, even as tourism reopens.

In a poll conducted by @STTAKenya, to find out what and/or where these funds were or would be invested, the results show that many companies will use the funds to recurrent expenditure, mainly paying salaries and debts.

In the early stages of the pandemic, VoyagesAfriq & AviaDev Africa hosted Africa’s first tourism dialogue on rebuilding tourism in Africa. Whereas financial stimulus packages were proposed by representatives of public tourism institutions, it was clear they were not long term solutions. I presented this list as critical for restarting tourism in Africa.

  • Restart tourism with sustainable development values
  • De_risk tourism
  • Strengthen SMEs
  • Restructure institutions to focus on resilience.
  • Bring down barriers that limit opportunities for entrants in destinations
  • Ensure data transparency for effective destination planning
  • Build new alliances for intra regional travel and domestic tourism
  • Rethink tourism measurement metrics to re-socialise tourism
  • Invest in digitisation and models for revenue retention in the destinations
  • Diversify product and market
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