IDB homes in on prospects for recovery

by Marlon Madden

One of Barbados’ leading development partners has identified domestic tourism as one of the drivers of the region’s tourism recovery, while pointing to several areas where urgent action is needed in order to speed up that recovery.

According to Inter-American Development Bank (IDB) officials, research points to several key considerations that will drive the speed of recovery in Barbados and other Caribbean tourism dependent states. The research is related to the recent Caribbean Quarterly Bulletin on Imagining a Post COVID Recovery.

It is authored by Olga Gomez Garcia, a development economist who specializes in the travel and tourism sector; IDB Economics Advisor Henry Mooney; David Rosenblatt, Regional Economic Advisor for the Caribbean Country Department of the IDB; and economist Maria Alejandra Zegarra.

They maintained that prospects for tourism dependent economies hinged on the evolution of the pandemic, the rollout of vaccine and the opening of borders. “Clearly, this is a key factor affecting people’s willingness to travel,” they said. In addition, they have identified domestic tourism, improved economic environment in key source markets, and greater understanding of factors driving people’s need to travel, as factors that will add to the region’s tourism prospects for the future.

“Domestic tourism lurks as a possible substitute for international travel,” said the report. In relation to the economic environment in source countries, the team said economic stimulus, particularly in the US, “might help to support the recovery”.

“Demand patterns are poised to change – perhaps dramatically – in the wake of the crisis, but much remains to be determined,” they added.

“These and other hard to anticipate factors underscore the need for improved tourism intelligence systems that can help governments and industry operators anticipate and adapt quickly to new preferences and behaviours, and to help guide policy design and investment allocation,” said the IDB team.

They also called on tourism dependent states to consider the benefits of business tourism versus leisure tourism, pointing out that “in the past business tourism recovered more gradually from shocks. The nature of the pandemic and boom in remote work might imply a longer lasting impact on that segment”.

They have also identified several key areas in which countries should take action in order to help accelerate recovery. “Our report considers factors that will drive economic recovery across the region, some of which are out of the control of Caribbean governments and businesses. Still, countries can do much to support a recovery through policies, investments, and other measures of their own,” said the group.

“These include efforts to reinforce tourism intelligence, and to adapt their tourism product offerings to suit a post-pandemic world. Such efforts must also consider changing travel preferences of both traditional and new consumer segments,” they explained. The report identified what it called priority areas such as a focus on safety strategy, strong market intelligence systems, innovation and the preservation and improvement in access to destinations particularly via air connectivity.

“Strong market intelligence systems will be more important than ever. These systems should rely not only on traditional statistics, but also on real-time actual travel bookings and tourism expenditure data. Frequent consumer sentiment surveys can also be a useful guide.

Innovation with respect to demand analysis, safety and security strategies, product distribution, carrying capacity, supply chain efficiencies, and destination management will be key,” they explained.

“Innovation and adoption of communication and information technologies at all levels is no longer optional, and cannot be postponed. Adjusting the tourism product to new preferences may be necessary for Caribbean destinations to fully participate in a global recovery of the sector.

“Preserving and improving access to destinations, particularly via air connectivity, and strategically increasing access to accommodate potential demand growth are going to be very relevant going forward.

Analysing the main market segments of each destination and focusing on prioritising accessibility for the destination’s main target markets, based on thorough market intelligence analyses, could make all the difference in terms of recovery,” they added.
marlonmadden@barbadostoday.bb