A closer look on Paris’ diseased tourism industry
On May 11, 2020 France commenced its return to normality. “Normality” however is a very delusive term for that what possibly could be restored after an unprecedented eight weeklong closure of any institution and infrastructure imaginable. Despite a strict confinement of 67 million French, the country’s statistics registered 181,000 Covid-19 cases, among them 30,000 deaths. Thus, it doesn’t come as surprise that the French citizens grill Macron’s Crisis Management. Equally unsound appears the economical balance: despite governmental aids the annual GDP growth rate is expected to set back in the negative to -10,6%. Numerous businesses fear bankruptcies, the stock market has crashed – among all there is one particular world-wide known industry in Paris that became especially infected by the virus: the tourism industry.
A CRITICAL DIAGNOSE FOR ONE OF THE WORLDS MOST VISITED CITY
As the 6th most visited city in the world, Paris welcomes up to 20 million foreign tourists yearly. While visiting iconic attractions as Disneyland, shopping on the Champs Elysée or dining in fine restaurants during business trips, visitors have spent a record-breaking sum of 56.2bn € in 2019 – the third highest sum, only behind London and New York. Along with the fact that 8% of all Parisian employments lay in the tourism sector, to be precise one speaks of 511,000 jobs in about 100,000 businesses, tourism can be identified as significant economic pillar of the city.
Now, in the aftermath of the non-precedented business and mobility restrictions this year, the tourism season is not expected to be an ordinary one. First indications for this development are reflected in the unusual decline in revenue in the spring of 2020. (fig 1)
For this summer, Corinne Menegaux, General Director of the Paris Convention and Visitors Bureau estimated the tourist industry activity to amount to only 30-40% and of the ordinary intensity. By the end of the year she optimistically granted the industry a growth to 50-60% of the ordinary activity. This slight increase in tourism related revenues is already identifiable when comparing the “confined” April and “partially deconfined” May (fig 1). Nonetheless, by the end of the year there will remain remains a total loss of 40-45 milliard euros. How is the downturn in touristic activity concretely explainable?
AN INFECTION WITH VARIOUS ORIGINS
Tourist arrivals equal industry revenues – at this very first step the virus had docked on. Despite the impression of a foreign overran city, Paris normally welcomes with 46% roughly as many domestic tourists as foreign visitors (54%). Yet, their spending on average, especially on accommodation, are significantly lower. Conclusively, foreign tourists are of higher value to the local businesses – and exactly those foreign tourists were in the result of health concerns, travel restrictions, and in multiple ways inconveniently circumstanced transportation in large extend held back in their countries of residence.
The opening of borders within the Schengen area on June 15th, signaled the tourism industries throughout Europe a spark of hope. Could they count on some Europeans to book a trip to Paris un the last moment? In the case of Paris, Europeans account in ordinary years for already for 70% of the travelers. Following polls of the French agency for tourism development Atout would 40% of the Belgians, 28% of the Swiss and 22% of the Spanish be tempted to revisit France spontaneously. Rather longer one will have to wait for the tourist from oversees. Americans, amounting to 9% and Asians to 6% are hindered. European travel restrictions and – if available – high costs for plane tickets hindered them to enter the country. Those tourists though are expected by Atout to arrive in fall– all under the premise obviously that a second wave is halted.
Once accomplished the arrival, the stay in the city of love and romance is accompanied by chemically aggressive hand sanitizers, the red lip stick-covering masks and physical distancing. Many iconic attractions such as the third level of the Eiffel tour or the Disneyland were closed until July. Moreover, a visit in Paris becomes even more unattractive with an obligation to wear mask in every museum, and since the 20.7 additionally in any public place. Can you imagine how agreeable this accessory can become in a 5-hour long Louvre exploration?
Having spent the months June and July in this city, I can speak from my own experience and confirm that the entire touristic experience has changed – both for the tourists and the Parisians. I barely had to wait tin front of the Musée d’Orsay or the Invalides, cafés were half empty, reservation in restaurants were no longer needed. Whereas I, and probably many locals truly don’t mind the moderate tourist activity, it carries along severe consequences for variously directly and indirectly connected businesses…
A VIRUS OF PROFOUNDLY CONTAGIOUS CHARACTER
One of the most crucial characteristics of the Covid-19 virus is the high contagion rate: peu à peu it infects adjacent systems. In the case of the diseased tourist industry, a decrease in tourists’ arrivals implies severe losses for variously connected business, and along with that, a risen endangerment for many of the 511,000 mentioned employments.
Being known for its culinary excellency, Paris offers its tourists 23,000 restaurants, cafés and bars. Their total closure in the spring months had upset its 153,000 employees, which eventually have found creative initiatives to address their anger. One of them I suddenly run into during a brief stay in Paris in the mid of May: 1000 different chairs framed the waterfronts of Bassin de la Vilette, on top of each, sharp expressions. A drop on the hot stone was in essence their comment to the governmental aid programs. Further disconcerting are the prospects of the upcoming, weak touristic season, which is not expected to be as profitable as usually and which will not allow the businesses to balance out their losses. No, the gastronomy is with losses of 76% in April, 61% in May and still 43% in June far away from being cured. – And those are the best conditions for the economic damage to infect connected warehouses, food producers or logistical companies.
Paris’ accommodation branch with an exuberant number of 2,500 hotels and 156,000 rooms all over the city illustrates a different but same example of the viral infection. Not only was there downturn in new bookings, the prepaid arrangements had also to be paid back.
Apart from the gastronomy and accommodation business, there remain many more infected branches, each depending and influencing the other. Significantly impacted are namely the entire leisure sector, the cultural sector, the event sector, the commercial sector, transportation sector and last but not least the public sector. The latter one estimably lost 83 Mio € in tax revenues.
ARE THERE ANY LONGTERM EFFECTS?
In difference to the actual Covid-19 virus, the infected tourism industry does at least not rely on an innovative treatment. “France remains in its leader position in European destinations“, position the experts themselves confidently regarding Paris’ popularity in a post-Covid touristic environment. With the return of foreign travelers, tourism will heal itself, and the contagion onto adjacent industries will be curbed automatically.
To bridge the difficult period, the politics will have to step in. And even if their tourism aid programs are as controversial as the newly formed government of Macron itself, it is in my opinion of greatest importance to keep talking with and about the iconic but so forgotten touristic sector.
Until sooner or later all the selfie sticks or couples on honeymoon return, I find it pretty fair towards all Parisians and domestic travelers to grant them their now peaceful city to themselves – their “home office” when translated into Corona language.
Author: Sandrine Neugart
*Dieser Beitrag ist im Rahmen des Kurses Krisenmanagement in der globalen Sars-Cov2 / Covid19 Krise entstanden.