Easing Restrictions Benefiting Travel Industry

Let's talk to Julia Simpson, chief executive officer of w t TC, that's the World Travel in Tourism Council. She joins us on the phone from London. Julia, how are you? Oh, hello, Tim, Hello Carol, I'm joining you from a very chilly London. Yeah. Well it's a chili New York here today as well.

So we are certainly thinking about tourism and vacation. But hey, you know, we heard Doug Christners just talk about today's decline in the markets and how investors are really trying to make sense of the omicron variant and when certainly you have a seat at the front of when it comes to the what governments are doing in London at least and in the UK. Hey give us an idea of of of really how the travel industry is dealing

with it, because it's still the early days. It is it is still the early days, Tim, I mean the Well Traveling Tourism Council. We look at the global impact on travel and tourism by the pandemic and we represent about two hundreds of the top CEOs and chairman in travel and tourism from cruise to hotels. So we get we talked to people on the regular basism and we get a good idea. I mean, just to put it into context, the pandemic really really hit travel and tourism

as a sector um. Probably while global GDP went down maybe about five point four percent in travel and tourism, we were hit by nearly fifty percent. So an industry that was worth nine trillion dollars globally was cut down to about four point six billion. That's last year. Now, we do a lot of researcher economic research with Oxford Economics,

and we'd be charting where this might go to. And I'm going to give you some us again in a minute, But pre the latest strain of covid um, we were looking at getting back to maybe globally eighty percent recovery if there aren't further restrictions by the end of twenty twenty two. UM. In the US, actually the picture is looking a bit brighter UM. TIM. The the actual value of traveling tourism to the US pre the pandemic, taking twenty nineteen as a baseline, was about one point eight

billion dollars. You took slightly less of a hit at around minds forty one in twenty that's mostly because of the strength of your domestic travel and tourism market, and so you sort of got sliced down to about one point one billion dollars. Now. The good news is UM this year you're expected to grow slightly ahead of the global picture by about thirty six percent, So that's slightly better.

And then if things were to continue and this I think there's big messages for governments here, but if things were to continue benignly or in the way we're seeing them now, you could get back to actually in a good time exceed in your pre pandemic g d P.

Well you do. That's the kind of numbers if you like, right, Julia, and you do think about the pent up demand, because you know, people can't can't retake the trips that they missed during the pandemic, but they can certainly go out and take a talent rims once they feel confident about moving forward. You mentioned government, I mean, the w TTC works with governments to raise issues and some of the

industry's concerns when it comes to travel and leisure. What are or what is the top one or two concerns of the industry right now that you all are bringing to global government officials. Yeah, exactly, we've been really sing the government's globally. First of all, a total lack of international coordination surrounding travel within the pandemic. You understand, when a pandemic hits the country, governments naturally look inwards. They're

worried about their own citizens. This is completely natural and normal. But as we sort of look up above the parapet and reach hands across the ocean, again with the severe lack of international coordination in terms of you know, what is accepted and what the rules are. So that's one problem. Another problem is we see these severe travel restrictions suddenly coming down So I'll give you a really good example.

When the new variant was identified in South Africa, a lot of countries immediately left to barring anybody from certain countries in the southern part of Africa coming to Europe and coming to other parts of the world. But the irony is that the very own World Health Organization w h O as we call it, um they were saying, yeah, it was a variant of concern, but they said that closing truants has absolutely no impact and they shouldn't be doing it. And the economic costs of livelihoods and people

can actually far outstrip the impact of the pandemics. So lack of coordination, severe travel restrictions, and also obviously the golden the golden bullet he or the silver bullet is the vaccination levels. You know, sooner we can get the world vaccinated, it can all get vaccinated. That is our

greatest um uh you know, prevention to this illness. So yeah, just in about a minute and a half, what is going on in landing because we all were watching the UK Prime Minister Boris Johnson his press conference yesterday and covid takening of restrictions once again in the UK, mandating masks encouraging homeworking. Um, what are you hearing from your members of your community about that specifically and London specifically,

because I know you're concerned about those those travel restrictions. Yes. Absolutely, the good news for travel and tourism is there haven't been any further restrictions that are emanating from the UK government. So I think they've recognized what I was saying earlier that once variant of this of COVID is actually in your community, it's absolutely pointless trying to put in front. Is so good news for travel and tourism. No, no

further restrictions there, which is great. Um. I think what they want to do is to try and restrict a little bit gatherings of people. And they're saying that you can go to work if you you have to be there in person, but if you can find an alternative and work from home. They're just saying for a period because as we know that the latest variants seems to be slightly more infectious and travel faster. Um, So they're

just being cautious. I think it's more cautious than dramatic, if I'm completely honest, because life is still carrying on pretty normally. You know, I can get on the metro, the underground tubes and try do people wear masks on the underground, you wear masks, So that's what you do on public, on any kind of transport, you wear a mask. Well, if you go into a shop, football stadiums. In fact, I'm going to see you what we call it soccer

here my soccer. I'm going to a soccer matcher this weekend and I will be able to join you know a lot of tens of thousands of people, but I'd be wearing a mask, and I'm probably going to be for my COVID vaccination certificate. We're gonna come back with Julia Simpson, she's president CEO at the w TTC World Travel and Tourism Council. Will continue this conversation right here on Bloomberg. Let's get right back to Julia Simpson, CEO

of w TTC. That's World Travel and Tourism Council. It's an organization of global business leaders that includes the chairs, presidents and CEOs of top tourism and travel companies. Carnival Corporation CEO Arnold Donald is among the chairs, and Julia Simpson is the CEO Julia. You before you had this role, you were at I a G. Or Internet On Airlines Group. It's the parent company of British Airways, Iberia aer Linguists Welling, And it was just a few months ago that you

that you left that company. And I want you to take us back to March when the world fell apart because of COVID, but also international travel in domestic travel just dried up. Take us back to what it was like to be at a large airline. Yeah, well it was. It was pretty horrific really, to be honest with you, because we actually saw all business almost come to a standstill. And I think aviation is very adaptable and it's very

good at dealing with crisis. I mean, it's obviously had the most tragic and horrendous crisis of nine eleven, but then you know, we've had financial crisis and we're really, really resilient. And what I thought was great about I a G. Is, you know, we made sure that we

had good, strong capital behind us. And I'm not, you know, up to date with all their numbers now, but I know that you know, when I was there, there was ten billions u UK sterling in the bank and we made sure that we we we make sure that were resilient with stand this. So it's a very very resilient company and it will come through it. And since the US has opened up, we've seen enormous pent up demand exactly as Carrol we're saying earlier, you know, the Brits

and the US and the EU. People from Europe traveling to the States has really really taken off. And a big message. I mean I was speaking to a key leader in in airports in the US today and they think that such pent up demands we could actually see, you know, a succeeding two numbers. Little message we must ensure. You know, we have these wonderful border staff at our borders in the US and in the UK, but as these numbers grow, I think we're going to need more people.

Um it's a little warning so that we don't get too much chaos. That the airport we value very much, but we need more of them. Julie, I know there's so much pent up demand for international travel and for travel when it comes to tourism, but what about when it comes to business. Does business travel ever get back to what it was before the pandemic. We're talking to David Rubinstein of the Carlisle Group yesterday and he said he doesn't necessarily see himself returning to flying somewhere for

a one hour meeting with somebody. Yeah, I think it's true. I think it's true that business travel is going to lag. We've always always seen that. But at the w TTC we've done some business report recently and interestingly, while the area of Asia Pacific, you know, Australia, Japan, um in China, they are actually coming out of their COVID travel restrictions for leisure travel slower. When that list, we are expecting them to rebound in business actually before everybody else. So

I think it will come back. And while I do respect the fact that we are getting used to doing a lot of meetings with Zoom, it's fine when you know your team and you know people, but when you need to forge new business or business maybe has got a lot of you know, dollar signed zeros behind it, it's really important that you do those deals in person.

And so I love love Zoom for when I'm talking to my team and people I know, But if I'm going to if I'm going to seal a big deal, I'm going to need to be able to do that in purpose in person, So I think it would be slower, but I think it will come back. Do you. I love that you you know, the CEOs of the travel and tourism companies of the world, they're all on are all a part of your organization. You mentioned talking with

a CEO just earlier today. When you look at the different sectors, whether it's hotels where there, it's airlines, whether it's cruise lines, restaurants, I mean, all of this plays into it. Um does what do Is there any consensus about the outlook generally and what about geographically the outlook

going forward? Yeah, I mean absolutely. And it's interesting because in the US, you know, you lost we lost five point five million jobs when when the pandemic struck from travel and tourism and hospitality, and hopefully, if things carry on opening up, we're going to get those back. And we you know, we should get be able to get back to at least sixteen point five million people employed

employed in the sector. So it's a massive sector. And the trends we are seeing in the US is that there is the pent up demand exactly as you said, Carol, and as long as more restrictions are not put in place, then you know, we could be seeing the kind of GDP of travel and tourism in the US get up to one point nine billion by the end of twenty twenty two and jobs, as I say, you know, well over sixteen and one and a half half a million. So I think that's really really important. The US is

doing well, China's doing well. You've got to remember that a lot of the buoyancy in the US was reliant a lot on domestic travel. We saw Thanksgiving that went very well. The airlines everybody coped really well, which was fantastic. But it's getting those international visitors back and that's work for because you know, it is worth sort of a millions of dollars so um. And then I think Asia Pacific will open up a bit later, but I think businesswise,

Asia Pacific will probably rebound faster. Yeah, we've ever been looking for it on the street to New York City in terms of m cities to walking on the cities and hearing lots of different languages and seeing people from all over, and it's definitely been something we have missed during the pandema. People are just yelling at me in English. New York City, Julia, Julia, have a great and safe and happy holiday season, so nice to catch up with you.

Julia Simpson, she's President CEO of the w TTC World Travel and Tourism Council, joining us on the phone from London,