Greece tourism suffers estimated €10 billion in losses

The pandemic has devastated global tourism. For Greece, it is estimated that the Greek tourism sector will loose €10 billion in 2020, according to Ernst & Young (EY).

As the tourism sector is a key pillar of the Greek economy, the impact on the country and a number of related services will be significant, EY reports.

The tourism sector directly contributes 11.7% of GDP and indirectly between 25.7% and 30.9%.

Based on the data, it is estimated that Greek hotels will suffer a loss of €4.46 billion- €3.26 billion for seasonal hotels and €1.2 billion for all year operational hotels.

The decline in tourist traffic according to the report, is due to travel restrictions/ the closure of borders and reduced demand.

The rapid spread of the novel virus in several of the most important countries of origin of the travellers- France, Germany, the United Kingdom, the United States, Italy, is expected to lead to a significant reduction in revenue.

According to estimates by the Ministry of Tourism cited by the EU report, even in the optimistic scenario, revenue losses in 2020 will approach almost €10 billion.

On the other hand, the country’s good performance in tackling the pandemic may allow it to claim a larger share of the market this year.

Furthermore, the report includes an estimate of the effects of the pandemic on the Greek tourism sector over a two-year period, based on three alternative scenarios – base case, worst case and best case. Accordingly, the Gross Value Added of the industry will shrink to €14 billion (base case scenario), €12 billion (worst case scenario) or €16 billion (best case scenario).

The biggest decline however is expected in the second quarter of 2020 and ranges between 41% and 53%, with the base case scenario estimating contraction at 49%.