China Coronavirus Outbreak Batters Travel and Tourism Sector

As the so-called Wuhan virus surges beyond 11,000 cases - most of them in China - the global tourism and travel sector is bracing itself for a prolonged slowdown. Many global airlines, starting with British Airways, have suspended all flights to China and several jurisdictions have begun to seal their borders to travellers from China, including foreign nationals.

Hong Kong, where the economy has been on its knees after seven months of anti-government protests, has been hit hard. Its border points with China have been almost entirely closed and flights to the mainland have been halved under government emergency measures.

Cathay Pacific, which derives a good chunk of its revenue from mainland services and which was already suffering from a downturn caused by the protests, is expected to take a serious financial blow. Hong Kong’s flagship carrier operates three flights daily to each of Beijing and Shanghai, while the sister airline, Cathay Dragon, typically runs almost 50 flights a day to mainland China. As with US carriers, cabin crew have been pressuring the airline to suspend mainland services all together due to health concerns.

Cathay Pacific flight attendants wearing face masks

But it is the mainland Chinese carriers who are first in the line of fire: many carry huge amounts of transit traffic - for example, from Vancouver International Airport (YVR) via China to southeast Asian destinations. The travel restrictions and localized lockdowns came during the Lunar New Year holiday - traditionally the busiest time for China’s commercial airlines.

Singapore, which is an extremely popular destination for leisure and business travellers from China, has banned visitors from the mainland, including foreign nationals. Its flag carrier, Singapore Airlines, which carries huge amounts of transit traffic to and from China, will take a major financial hit as well.

The Prime Minister of Singapore, where strict travel measures have been imposed, told reporters on Feb 1: “We have to protect ourselves.”

The United States last week introduced its own travel restrictions in response to the outbreak and several US carriers have cancelled all services to China. They too will feel the pain as China accounts for a large proportion of their overseas revenue. On January 31, Atlanta-based Delta Airlines became the first US carrier to completely suspend flights to China - between February 6 and April 30, 2020. Many airline unions representing cabin crew have threatened action against their employers if they are forced to work China-bound flights. Delta currently operates 42 weekly flights between the US and China.

Many major cities in China are in lockdown and several countries have either evacuated their citizens or advised them to leave as soon as possible. Inbound tourism is almost nil and this will impact the Chinese and foreign-owned hotel chains operating on the mainland and in Hong Kong. Most of the major chains have been expanding rapidly in China with new developments.

But it is also destinations which host large amounts of Chinese business and leisure travellers which will be hard hit. In mid-January, Chinese President Xi Jinping banned tour groups from leaving China and this will reverberate around the globe. Already popular destinations such as Australia and Portugal are feeling the downturn.

Destinations popular with Chinese tourists, such as Portugal, are beginning to feel the impact of the slowdown in outbound tourism from China.

During a recent visit to Spain’s Costa del Sol, My Savvy Traveller writers did not see one Chinese tourist.

Curiously, in declaring a global public health emergency last week, the World Health Organization (WHO) advised governments against imposing unilateral “travel and trade” restrictions on China - however most member states appear to be ignoring this guidance.