The war in Ukraine means that the outlook for tourism in Europe next year looks worse than expected, according to a recent forecast. Higher fuel costs, increased unrest and fewer tourists are hitting the sector.
Russia's large-scale invasion of Ukraine and the sanctions imposed on Russia as a result have dealt a major blow to the European tourism industry.
The Economist Intelligence Unit (EIU) has lowered its forecast for next year, no longer believing that it will be the year when travel in Europe returns to pre-pandemic levels. And this summer is also looking bleak.
The analysis company, a sister company of The Economist, sees four reasons for how the war is hitting tourism. The first is the loss of Russian and Ukrainian tourists, the second is restrictions on air traffic and airspace use, the third is higher food and fuel costs, and the fourth is lower confidence among tourists, combined with lower disposable income.
When it comes to high fuel costs, it is primarily jet fuel, which has risen 80 percent in a year, that is hitting travel. Fuel accounts for 20-30 percent of airlines' costs and, combined with higher insurance premiums, is hitting companies already hard by the pandemic.
In 2019, Russian and Ukrainian travelers accounted for five percent of global travel and spent around $50 billion together. Countries like Turkey, Poland, and Italy are likely to be hit hard by a reduced inflow. Some smaller tourist destinations like Cyprus, Montenegro, and Latvia were even more dependent on Russian tourists before the pandemic, who, according to the EIU, accounted for 20, 29, and 36 percent of all foreign visitors, respectively.
There are also signs that as a result of the war, tourists are refraining from flying to countries that are geographically close to Russia, such as Eastern European countries, Sweden and Finland, according to the EIU.
”"Although the war in Ukraine is primarily a humanitarian disaster, it has dampened hopes for a tourism recovery in Europe this summer," writes the EIU.
