The Delta variant leaves southern Europe struggling to save on summer tourism

The countries of Southern Europe are in a position without envy of having to restrict foreign tourism or risk the rapid spread of the Delta coronavirus variant, as economists warn of another disappointing season in any way.

Tourism-dependent countries like Spain have it pushed back against German Chancellor Angela Merkel’s call for a coordinated EU response for travelers to countries with high levels of the variant first detected in India.

But economists say they should always balance the reception of tourists from countries like the UK and Russia, where the variant has spread, against the risk of the variant taking off in their countries.

“The exchange is already evident, with the likes of Greece and Spain saying they are open to everyone, while the cost-benefit equation is clearly seen very differently in the countries of Northern Europe,” Jessica said. Hinds, economist at Capital Economics.

This week, Spain, Portugal and Malta tightened some restrictions on British tourists. Earlier this month, Italy asked UK travelers to quarantine them for five days. But after a drop of up to 80 percent in foreign tourism revenues last year, such countries are looking to regain lost ground.

According to the OECD, incoming tourism accounted for 10% of gross domestic product in Portugal and Greece and almost 6% in Spain in the year before the pandemic.

Illustrating his desire to attract tourists, Spain and Portugal in May lifted most test and quarantine restrictions on arrival from countries such as the United Kingdom. Greece has done the same for vaccinated arrivals from 53 countries, including Russia. Since then, the United Kingdom and Russia have had sharply increasing Delta variant infections.

Overnight stays in the EU fell 55 percent in June from pre-pandemic levels, according to Oxford Economics, but predict the decline could be as low as 25-15 percent in August. Google searches for accommodation in Spain are shown at 2019 levels.

McKinsey, the consultant, is gloomier. Expected revenues from general tourism in Spain and Portugal will be half of pre-pandemic levels this year and only pick up in 2024.

Line graph of Spanish incoming tourist expenditure (€ billion) showing a better forecast for summer in Spain

The EU will launch its own digital vaccination certificate Thursday to make it easier for residents who are completely vaccinated, who have a negative test result or who have recovered from Covid-19 to travel in the 27-nation block.

However, countries like Spain also want to welcome tourists from outside the EU, particularly from Britain. Normally, the UK is the largest source of visitors in Spain, counting 18m in 2019, compared to 11m each from Germany and France, the second and third ranked countries.

The rapidly changing situation complicates matters. This week the UK gave a boost to Spain including the Balearic archipelago on its “green list” to travel without quarantine. But Spanish Prime Minister Pedro Sanchez has therefore reintroduced restrictions on British tourists, demanding that they be completely vaccinated against Covid-19 or show a negative PCR test. The move affected the share prices of airlines including Ryanair and easyJet.

Infection rates in the Balearic Islands have already risen since thousands of Spanish students traveled there to celebrate the end of exams two weeks ago. At least 850 of them have tested positive for Covid-19.

Tom Jenkins, chief executive of the European Association of Tour Operators, said the uncertainty would deter many in the UK from traveling this summer. “Volatility in both epidemiological and political risk means that every reservation is full,” he said.

An example of how things can change quickly comes after Portugal lifted restrictions on British tourists on May 17 shortly before the UK government added the country to its “green list”.

But three weeks later, the UK expelled Portugal from the list, encouraging many tourists to return soon to avoid being quarantined. Since then, an influx of infections has given Portugal one of the highest levels of Covid-19 in Europe, prompting it to impose weekend bans on trips to and from Lisbon.

A week later, Germany gave another blow to Portugal, adding the country to its list of “coronavirus variant countries” and banning most travelers from the country except German residents, who must put in quarantine for two weeks on return. Portugal has now imposed similar quarantine rules for unvaccinated arrivals from the United Kingdom.

Merkel told a press conference last week that “we have a situation in Portugal that perhaps could have been avoided” if EU countries had taken a uniform approach to travelers from the most risky areas. A few days later, Malta stated that it would not accept vaccinated travelers from the UK.

The German chancellor has also mocked Greece for accepting visitors inoculated with Chinese and Russian vaccines that have not been approved by EU authorities. This week Greece said it would require a negative coronavirus test from all passengers arriving from Russia, even if they were vaccinated.

Economists say the EU’s vaccination program is a race to save the region’s tourist season from the Delta variant. Rafael Doménech, head of economic analysis at Spanish bank BBVA, said: “The best response to this threat is to speed up the vaccination campaign.”

More information from Eleni Varvitsioti in Athens is Peter Wise in Lisbon

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