Willemstad, April 21, 2020 – Recovery is defined as regaining strength or composure, it is also defined as making up for something, or making something good again. With the industry taking a hit like COVID-19, it is safe to say that as an island, Curaçao must recover. In order for recovery to happen, one must be familiar with the situation, before analyzing possible methods of recovery.
According to CHATA President & CEO, “Recovery of our industry doesn’t only rely on internal factors, but also how the world will respond after this COVID-19 crisis, this pandemic will change the landscape of “business as usual” and our recovery plan must be as comprehensive as-possible. In time, we also believe that we must be the first mover to open back our country for business. If we don’t start planning for the future, our financial crisis will be bigger than our current health crisis. We have a once in a lifetime opportunity to take our destination, government infrastructure and how we do business to the next level, but this requires courage and an out of the box thinking to re-invent ourselves as a country. From lowering our cost of doing business, new policies in place, to an innovative tax reform, these are just a few ingredients of a much-needed recovery plan for our tourism industry, but better yet for our Country.”
CHATA reviewed and formed an analysis on “When will Curaçao’s Tourism Industry recover”, with the support from Caribbean Data and Tourism Analyst, Mr. Jim Hepple, who guided the analysis and findings of the report.
Curaçao’s economy is dependent on welcoming visitors from abroad. Hence, there will be enormous pressure and need to re-open its borders to visitors as there is no domestic demand to speak of. CHATA discussed that there are three possible scenarios that the COVID-19 pandemic can bring, an optimistic, a likely and a pessimistic scenario. These scenarios reflect the worst possible outcome if no action is taken, a base case of what is considered to be the most likely outcome, and the best-case scenario.
The optimistic scenario would include that the USA and the Netherlands will relax, if not remove, their social distancing regulations by May 1 and remove all restrictions on entry to the countries from foreign countries. This would also mean that people will start going back to work and the economy will slowly start to recover.
The likely scenario would include that the USA and the Netherlands will continue with its social distancing regulations throughout the month of May and possibly June and will keep the restrictions on entry to the countries from foreign counties until May-June. People will slowly start going back to work, with most people not re-entering the workforce until July/August.
The pessimistic scenario would include that the USA and the Netherlands will continue to keep the social distancing regulations through the months of June until possibly August, while indefinitely keeping all restrictions on entry into the country from foreign countries. This would result in people slowly going back to work, with many not re-entering the workforce until September/October.
It is important that through a time of crisis, we must hope for the best and invest for the best possible future. CHATA expects that the likely scenario would take place, meaning Curaçao could start to recover locally in May-June before opening their borders by the Summer period of June the latest. It is important for us to start the dialogue of re-opening our borders in the future as soon as possible for the sector to prepare itself. We are aware of new policies and regulations to be announced, such as to have mandatory testing at all ports of entry; this is something that the Government will have to invest in. Tourism generated US$1.2 billion in direct and indirect economic activity. This amounts to 37% of Curaçao’s GDP of US$3.263 billion, and 25% of the employed labor force, generating 16,000 jobs out of the estimated 65,000 people employed on the island.
As for the hospitality and tourism sector, the USA and the Netherlands in-market research both indicated that consumers will travel in the future, and by being one of the first movers, we will be able to capitalize on these markets. Past experiences suggest that it will take 1-3 years to get back to ‘normal’. Normal refers to where the volume of arrivals would get back to levels achieved in 2019. In order for Curaçao to revive its tourism industry, all key stakeholders must work together in identifying new products and markets and invest in the tourism and hospitality workforce. The road to recovery might be long, but the journey of a thousand miles begins with a single step.
It’s time to switch the conversation from Crisis to Tourism Recovery.