Cuba's Tourism in 2019 and Perspectives for 2020

THIS NEW CORONAVIRUS OUTBREAK SPREAD THROUGH CHINA AND HAS HIT OTHER REGIONS OF THE WORLD. MEASURES ADOPTED HAVE NEGATIVELY AFFECTED MULTIPLE AREAS

Over the last couple of years, international tourism in Cuba as an economic activity has been limited in its development by economic-induced structural problems that are difficult to work out. Among the most relevant are insufficient domestic savings, chronic shortages of foreign currency and external financing, distortions in the relative price system resulting from the use of an overvalued exchange rate, segmented markets and the duality of currency and exchange rate, among others. This scenario has contemplated the permanence and intensification of the trade, economic and financial restrictions imposed by the United States government, which showed their worst side starting in the second half of 2019.

A CLOSER LOOK AT THE WORLD SCENE

The increase in global tensions has had a negative impact on many countries, which are traditionally sources of travel and tourism for Cuba from Europe. The year 2019 clearly demonstrated that the international economic order faces uncertainties and transformations that reveal the exhaustion and limitations of the current development model; realizing that economic recovery will hit a slowdown in the coming years.

From Europe, the main tourism markets have been affected by the prolonged uncertainty regarding the departure of the United Kingdom from the European Union (Brexit); which has led to the collapse of Thomas Cook, one of the world's largest tourism and travel operators; also disrupting several airlines, which have affected travel to 38 countries, particularly in America and Europe, cancelling 8.6 million airline seats in the last three months of 2019.

Given these realities, which indicate that tourism will have to face stormy times that will slow down its growth; the expansion of SARS-Cov2 contributes to make the scenario even worse, with very negative forecasts for the coming months. Nevertheless, as in previous occasions, the travel and tourism industry will show its quick capacity to recover from similar situations.

It should be added that the slowdown in travel and international tourism to the Caribbean subregion in particular, from which Cuba is not exempt, has been influenced in recent years by three main factors: the emergence of new emerging destinations in several subregions of the world, which compete strongly with Caribbean tourism; the frequency and intensity of weather phenomena; and the absence of a real and effective renewal of tourism products on offer.

CUBA'S TOURISM IN 2019

Despite the current perverse scenario, and since the beginning of Cuba's opening to international tourism, the economic and financial situation of the island, the restrictions of the

The sanctions and the persecution of Cuban assets by the Office of Assets Control (OFAC), maintained for many years, are maintained and ratified with the restrictions of the U.S. government constantly extended with new regulations in 2019. This is a real and significant impediment to the arrival of visitors, to compliance with the development plan and to the quality of tourist services.

In 2019 international arrivals reported 4,275,561 visitors, a decrease of 9.3% over the previous year. In spite of the restrictions, 1,051,433 residents of the neighboring territory traveled from the United States, of which 552,895 were Cuban-Americans and 498,538 Americans; none traveled as tourists, since regulations prohibit tourism on this Caribbean island.

The decline of the traditional European outbound markets is significant, confirming that global political and economic factors, which generate uncertainty in several markets of the old continent, have a negative impact on tourism.

The results report 19,366,871 tourist days, a 1% increase compared to 2018, with a tourist income of just over 2,616 million CUC (Cuban Convertible Pesos).; slightly higher than the previous year. In this sense, the growth of tourism of stay

from Canada and Russia contributed to better results in this indicator.

In 2019, the accommodation infrastructure closed with 74,211 accommodation capacities distributed in 422 facilities, where 74.7% of the rooms correspond to the beach mode, with 188 hotels. Accommodation for mass sun and beach tourism concentrates 85.6% of the country's total 4 and 5 star rooms.

According to market trend studies published by the World Tourism Cities Federation (WTCF), urban tourism or city tourism is gaining importance due to the growth of these higher income and culture-driven travel segments. In this sense, the country's hotel development plan for the coming years should focus its efforts on the construction and remodeling of city hotels with a five-star category, and in some cases higher, especially in the cities of Havana and Santiago de Cuba.

In the area of hotel management and marketing, the year 2019 closed with 105 hotel management contracts signed with 21 foreign managers from ten countries, involving 132 hotels with 50,207 rooms, some of which are in the process of construction.

CUBA IN 2020: MOVING ON WITH INDEPENDENCE AND SOVEREIGNTY

Nowadays, tourism and tourists are different; the concept of holidays has changed, the way to enjoy them is different, the explosive acceleration of high technologies is present in all stages of the journey and they mark the paths that the tourist destinations of each territory must follow, supported by government policies.

For the Cuban tourism sector, 2020 will represent a year full of great obstacles and challenges: a constant intensification in the restrictions imposed by the blockade and U.S. policy; the confrontation with the SARSCov2 pandemic, whose consequences will affect the normal flows of international visitors; adaptation to climate change and other meteorological phenomena; and the lack of financial resources to continue the projects of the development plan.

The possibility for the Cuban tourism sector to appropriate the benefits of tourism depends on several internal factors; one of these is the competitiveness of the local industry and its capacity to provide businesses in the sector with much-needed import substitution. No country can succeed in its tourism development by moving away from the sphere of endogenous production.

Investment in infrastructure is indispensable in the process of tourism development. In this aspect, large hotels, magnificent ports, airports and roads can be built; but the real contribution to development is materialized to the extent that the sectors producing food, goods and services increase their actions and productions rapidly; thus facilitating the efficient use of infrastructure.

The current situation will demand an inclusive effort that guarantees sustainability through constant innovation, supported by the growth of the other productive sectors, as a response to market changes, and that really energizes the economy, maintaining a balance with the environmental and social aspects.

Promoting and expanding the offer of Cuban tourist destinations not only responds to the need to increase the financing capacity from external sources; it also contributes to increase the spiritual and material satisfaction of most of the Cuban society that accesses these destinations, that feels part of them and that thinks of them as a country.