Greek Tourism Sector Recovery Depends on Covid-19 Crisis Duration, Says BoG

The duration of the coronavirus pandemic will be the decisive factor for the Greek tourism industry’s comeback, according to Bank of Greece (BoG) Governor Yannis Stournaras.

According to the March report issued by the central bank, it is too early to assess the repercussions of the coronavirus health crisis on the Greek economy but the tourism industry and particularly revenue is set to suffer a blow.

“The outlook for the tourism sector for 2020 is expected to be affected by the extent of the coronavirus spread,” said the BoG.

At the same time, the latest decisions to ban all circulation and travel, close down hotels for a month, stop incoming flights, as well as impose 14-day quarantines in efforts to restrict the spread of Covid-19 have already taken a toll on the industry.

Demonstrating the importance of the tourism industry today compared to a decade ago, central bank data cites 2019 travel receipts which came to 18.2 billion euros accounting for 9.7 percent of GDP at current rates. In 2010, tourism accounted for a mere 4.3 percent of GDP.

At the same time, the sector’s seasonality is also set to impact revenue. It should be noted that four months – June, July, August, and September – accounted for 73.9 percent of all tourism-related revenue in the last nine years.

Indicatively, in 2019, out of a total of 18.2 billion euros in annual travel receipts, 13.3 billion euros were generated in the June-September period.

Other negative factors include the uncertainty and the resulting deterioration of the investor climate.

Last year’s tourism performance with increased arrivals and overnight stays for a seventh consecutive year had paved the way for an even stronger year in 2020 before the Covid-19 crisis hit.

According to 2019 figures, the number of beds increased by 1.4 percent in 2019 against 2018 boosting employment by 9 percent.

Lastly, according to the BoG report, besides tourism, other sectors set to feel the brunt of the coronavirus pandemic and suffer losses include transport, trade, F&B, and services related to entertainment and recreation.