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Covid 19 - impact on tourism

Napsal/a Klára Stárek Zachariášová | 03.25.2020
COVID-19 Press releases

PRESS RELEASE

The Czech Association of Hotels and Restaurants has enumerated the impact of the pandemic on tourism

Prague, March 24, 2020 - In cooperation with Economic Impact, The Czech Association of Hotels and Restaurants has developed another set of model studies that, based on the actual tourism performances over the last year, give an initial idea of ​​the effects of the current coronavirus pandemic and of the restrictive measures associated with it on both the domestic and the international travellers, including the impacts on the entrepreneurs, employees and the state budget.

The sample situations have been modelled around two options, with both of them foreseeing significant drops in occupancy and consumption rates, subsequently predicting a gradual improvement in the situation when the presently implemented restrictive measures have been lifted. The outlined options differ in the times by which these measures should be relieved. The first option expects the restrictions to last by the end of April, while the second works with a theory of the restrictions continuing as long as by the end of June this year.

IMPACT STUDY HERE:  Covid 19 impact - number

Impacts in numbers

If the current restrictions imposed by the Government were to last until the end of April 2020 (and the closure of the borders until the end of May 2020), then approximately 173 thousand full-time employee equivalents (FTE) will be directly endangered, tourism consumption will decline by about 142 billion Czech crowns (47%) this year, total revenues related to tourism will in multiplication drop by about 286 billion crowns and public budgets will lose about 60 billion CZK in total.

Under the second option, with the restrictions possibly lasting until the end of June 2020 (and the closure of borders until the end of August 2020), approximately 246 thousand FTEs will be endangered, tourism consumption will decrease by about 202 billion crowns (by 67%) and the total revenues related to tourism in multiplication by about 408 billion crowns, with public budgets losing some 85 billion Czech crowns in total.

Václav Stárek, President of the AHR CR and Vice-President of the Confederation of Commerce and Tourism hereto adds: “The above-mentioned models make it apparent that the impacts on entrepreneurs in tourism and on their employees will be overwhelming. We believe that measures need to be taken very quickly to support entrepreneurs and their employees, regardless of whether they are tradesmen or companies. Given the situation, it is now of essence to sustain entrepreneurship as such, for it to be able to recover as quickly as possible. This means that tax reliefs, wage allowances, tax breaks to bring tourism back on track, deferred payments of wages and employee levies are the very steps that might help keep tourism alive. It is not just about overcoming the period when the current crisis measures will be in force, but also about the subsequent period when entrepreneurs will be starting again from the scratch, often even with losses. This situation affects not only entrepreneurs, but also their employees whose future is most uncertain, too. ”

Václav Stárek further stated that hotels and restaurants in the Czech Republic were respecting the necessity of these measures and were ready to help actively if need be. The AHR CR has already offered the Prime Minister a possibility to ensure accommodation for the rescue teams and other employees who are now fully engaged in helping to fight the pandemic across the country, the hoteliers are prepared to assist in providing facilities for the elderly people if such a need arises, and many restaurants are already helping out with catering arrangements. However, under the current restrictions, it is not possible yet to provide accommodation for example to such company workers who are shuttling around and work in the field, fixing electrical wirings or ensuring maintenance of the country’s most vital grids. The Government should therefore also consider an exception allowing the provision of accommodation services for these purposes.

Key restrictive measures in force in the Czech Republic as of 23 March 2020 in connection with COVID-19

  • Following the Government Resolution No. 194 of 12 March 2020, the Government declared a state of emergency for the territory of the Czech Republic in accordance with Articles 5 and 6 of the Constitutional Act No. 110/198 Coll., On the Security of the Czech Republic.
  • With effect from 6.00 am on 14.3.2020, the Government of the Czech Republic decided to close restaurants and other catering facilities (with the exception of staff catering and take-away services).
  • With effect from 00:00 on 16 March 2020, the Government of the Czech Republic prohibited the free movement of persons throughout the Czech Republic.
  • On 13 March 2020, the Government of the Czech Republic decided to completely close the borders and prohibit travels outside the Czech Republic with effect from Monday 16 March 2020.
  • On 16 March 2020, the Government of the Czech Republic decided to adopt a crisis measure: a ban on the sale of accommodation services.

 

Contact: Václav Stárek, President of the AHR CR, starek@ahrcr.cz, +420 602 765 632

PRESS RELEASE IN PDF HERE:  24 03 2020 TISKOVÁ ZPRÁVA - AHR ČR_EN

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