‘Tourism prospects bleak’

Recovery prospects for tourism and business travel remain bleak as international travel restrictions are still broadly in place amid the coronavirus disease 2019 (COVID-19) pandemic, British banking giant HSBC said.

In its latest research note, “Tourism vs technology: A two-speed recovery in service trade,” HSBC said the global health crisis has resulted in an unprecedented fall in services trade for most economies.

Services exports from advanced economies contracted by 28 percent in the second quarter, steeper than the 25 percent decline in goods exports.

HSBC said emerging markets have also experienced steep contractions in their services exports with few signs of revival amid ongoing travel restrictions.

For one, it said export of services from the Philippines fell 43 percent from April to June this year compared to the 35 percent drop in the economy’s goods exports.

Thailand’s services exports tumbled by over 70 percent while Malaysian services exports were down 55 percent in the second quarter.

The Bangko Sentral ng Pilipinas (BSP) is seeing a deeper contraction of 17 percent instead of the earlier projected decline of 13 percent in services exports.

It also expects a bigger 65 percent plunge in travel receipts instead of 56.9 percent this year.

HSBC said services flows are bearing the brunt of the trade shock amid the COVID-19 pandemic unlike when it demonstrated remarkable resilience during the global financial crisis in 2008.

“Tourism and business travel, which together comprise nearly one quarter of global services trade, have largely ground to a halt thanks to global travel restrictions,” HSBC said.