Social prices of tourism amid COVID-19 pandemic

Richard Qiu and Sílvia de Almeida

Integrated Resort and Tourism Management Department

Faculty of Business Administration, Macau University

The novel 2019 coronavirus disease (COVID-19) pandemic has had a severe impact around the world at an alarming rate. It is believed that tourism and mobility are harbingers of the further emergence or recurrence of infectious diseases. For this reason, the consequences of the pandemic for tourism destinations are particularly serious, as travel restrictions and border closings are being introduced around the world.

It is generally accepted that tourism has direct, indirect and induced effects on a travel destination from both an economic and a social perspective. Much scientific and market research has mainly focused on the economic benefits that tourism can bring, while the societal effects of tourism on local residents are somewhat under-researched. Prof. Richard Qiu of the University of Macau and his staff from Hong Kong and mainland China have looked into the issue, examining the social costs of tourism activities during a pandemic in the eyes of local residents. The authors examined the premise that a crisis could actually mitigate residents’ negative perceptions of tourism. In essence, the study predicted that the social costs borne by residents, such as public safety, would outweigh the economic benefits of tourism; and ultimately, measure residents’ willingness to sacrifice such economic benefits in order to minimize potential social costs during the pandemic. The empirical results suggest that each resident would sacrifice an average of (HK $ / CN ¥) 200 to reduce the potential risk of tourist activities during the pandemic, resulting in an estimated total social cost of CN ¥ 825 million (1417 CN ¥) leads millions and 1215 million CNY in Hong Kong, Guangzhou and Wuhan, respectively.

From another perspective, the estimates above also reflect the potential benefit of a travel restriction on a tourist destination. At the same time as reducing the volume of tourist arrivals and tourist revenue, strict travel restrictions and border control guidelines are protecting the city from the pandemic. According to local residents, one of the main players in the city suggested paying a premium to limit tourist activities and, consequently, the transmission of viruses. It shows that the majority of respondents were much more willing to pay for the risk deduction, and it is suggested that charities could benefit if they set up specific funding for the purpose of risk reduction. If we look back on the situation in Macau over the past year and compare it with our neighbors, we can proudly say that the strict border control guidelines that the SAR government in Macau adopted at an early stage, in terms of the social costs of tourism activities Have minimized the cost of virus transmission. Similar results are suggested by scientists from Europe, who find that travel bans in the EU region may have saved more than a million people from COVID-19 infection and tens of thousands of lives from death.

Looking ahead, the ongoing pandemic would cause increasing damage on a global scale, especially among small and medium-sized businesses. The government will have no choice but to balance security (through strict border controls) and economic benefits (through opening up to tourists). With that in mind, the recent policies of the Macau SAR government to stimulate domestic tourism and accept “safer” tourists from mainland China have definitely eased the case and effectively pushed the situation towards a more optimistic scenario. These incentive measures can be used to address the social costs of the pandemic, especially the communities hardest hit by the pandemic. We can already see in the case of mainland China where the tourism industry has gained momentum in the region where local tourists have slowly traveled inland to various destinations. In addition, there is an increasing need for an innovative and holistic approach to planning recreation in tourist destinations. Hence, the government should focus on all areas of society, which would result in a more balanced recovery.

Another interesting result of Prof. Qiu’s study was that residents’ willingness to pay was significantly influenced by age, income and tourism employment. A specific understanding of the situation was that young residents were actually more willing to pay for risk reduction. The reason for this is the fact that younger people are more likely to be connected to the internet and more digitally savvy, which gives them real-time access to the most up-to-date information about the pandemic. Hence, both local authorities and tourism organizations could better benefit from the influence of younger generations to cope with and recover from crises like the current pandemic and rebuild for a better future, as the younger generation tend to be more knowledgeable and motivated.

This article is based on: Qiu, RTR, Park, J., Li, SN & Song, H. (2020). Social costs of tourism amid the COVID-19 pandemic, Annals of Tourism Research, 84, 102994, DOI: 10.1016 / j.annals.2020.102994.