While there is little optimism regarding the immediate future of the global economy as the COVID-19 coronavirus pandemic continues, a new forecast from experts reveals that the economy and travel demand are both likely to bounce back quickly once the threat has passed.
Oxford Economics—a leader in global economic forecasting and quantitative analysis—revealed that, although we are currently sinking into a global recession that will likely result in international travel falling by over ten percent, economic recovery should follow quickly.
According to Travel Weekly, Oxford Economics said, “Attention is understandably focused on limiting the damage from the short-term effects of the coronavirus outbreak. But it’s likely that, once disruption and uncertainty fade, the rebound in global economic activity will be strong.”
The firm also acknowledged that travel bans and other government-imposed mandates aimed at stopping the spread of the virus will impact the travel and tourism industries most heavily.
“An unprecedented fall in global travel is now likely in 2020,” Oxford stated, with the Asia-Pacific region being the hardest hit, as it’s set to see a projected fifteen-percent decline in visitor arrivals, 55 million fewer, compared with last year. Travel to Europe is expected to fall by nearly ten percent in 2020, which equates to 72 million fewer visitors than in 2019. Meanwhile, North America can anticipate a drop in arrivals of almost eleven percent, translating to the loss of sixteen million visitors.
Still, Oxford predicted, “Once the situation has stabilized, we expect a rapid recovery, since travel demand has proven resilient in bouncing back from downturns in the past. Travel levels are expected to fully recover by 2023.”
The research group also reported that the U.S. is already in recession, and forecasted an overall gross national product (GNP) loss of $350 billion, with one million layoffs. Again citing historical evidence, Oxford pointed to the short recessions that have occurred over the past two centuries, which have typically been followed by a period of robust recovery.