Business Planet takes a look at Europe's travel and tourism sector, one of the hardest hit by the coronavirus restrictions, to find out what the EU is doing to help and ask how the sector moves forward.
For 20 years, Anne Prost has been offering tailored tours of Lyon’s old town and gastronomic hotspots. The day we meet she's welcoming a group of masters students to the French city. Her company, which is focused on the corporate market, was booming before the pandemic struck. Now, Anne says it’s all about survival, admitting she’s had to make some difficult decisions.
"Unfortunately, I had to lay off the trainees that I had. After that, it was important to reassure the clients who'd already paid me, to tell them that I was going to reimburse them, or I was going to put the money to one side for a future service. And then I had to call my clients to tell them I'm still here, and that as soon as we're out of this period right now, I'll be able to offer you a new and even more incredible service."
Like most companies working in the holiday and hospitality industry, Anne has had to adapt her business model to the 'new normal' since lockdown restrictions were eased.
"It's about reassuring people, explaining to them that outside, they'll be safe. Taking them to places where there will only be a few of them, so we're sure they'll be in small groups, even if it means making several small groups. I have a whole team of guides who work for me, so we adapt. It's about adapting and reassuring people."
Despite the drop in demand and all the associated challenges created by the health crisis, Anne is optimistic for the future saying she's even started to see some international clientele return.
"In the beginning it was very complicated. Foreign students were able to return and to come and settle in Lyon because they study in French schools, even though they come from all over the world. Afterwards it was more complicated for companies, they were refused a lot of visas, but I have some reservations that are being confirmed, so I remain very positive."
The road to recovery and beyond
Accounting for a massive 10 percent of EU GDP, Europe's holiday industry is hurting badly. Services in the sector plunged by 75 percent in June compared to February this year. To save millions of jobs, the European Commission relaxed state aid rules. Since then, it's also deployed its financial power through several Europe programmes and funds, such as the Coronavirus Response Investment Initiative, Sure Programme and European Investment Fund, to get much needed liquidity to firms.
"If you want people to travel again, they need to feel safe and confident about where they can go and where they can't, and about which obligation they have to comply with. Therefore it is vital for European countries to coordinate when they impose travel restrictions, they have to use common criteria to designate risk areas, based on scientific evidence. They have to set testing protocols for travel. This is what the European Commission is proposing, and we are strongly supportive."
While there is no question the pandemic has had a devastating impact on Europe's tourism sector, the longterm hope is it can engender a positive transformation, creating greener more sustainable holidays. Going forward the European Commission has said it plans to work with member states to use some of the recently agreed 750 billion euro Recovery Fund to make tourism more sustainable.
"After this crisis I believe that people will want to know more when choosing their travel options," says Mounier, adding: "They will want to know not only what is the best deal they can get, but also which travel option is more sustainable, for example, and therefore tourism operators will have to be more transparent, and digitalisation will play an increasing role in this regard, making travel simpler and cheaper, but also safer and cleaner."
The European Commission has put in place a number of measures to support the travel and tourism sector.
In May, it adopted the tourism and transport package of initiatives and common criteria. This package aims to help member states lift travel restrictions within the EU and allow tourism businesses to reopen, after months of lockdown, while respecting necessary health precautions.
In June, a dedicated website and a mobile application REOPEN EU with an interactive map was launched, to provide tourists and travellers with relevant information on safe travel in the EU.
The Commission has also moved to ensure liquidity for tourism businesses, in particular SMEs, through greater flexibility under State aid rules as well as EU funding, including:
providing immediate liquidity to businesses affected by the crisis through the Coronavirus Response Investment Initiative, under shared management with member states.
making available up to €8 billion in financing for 100,000 small businesses hit by the crisis, through the European Investment Fund.
To support jobs, the SURE programme is helping member states cover the costs of national short-time work schemes and similar measures allowing companies to safeguard jobs. The Commission is also supporting partnerships between employment services, social partners and companies to facilitate reskilling, especially for seasonal workers.
In July, the European Council reached an agreement on the EU's recovery plan and budget between 2021-2027. It authorises the Commission to borrow up to €750 billion on financial markets, €672.5 billion going to the ‘Recovery and Resilience Facility’.