Cancellation crisis hits the tourism and travel sector as government offers support

An empty terrace in Malaga city centre on Thursday evening.
An empty terrace in Malaga city centre on Thursday evening. / MIGUE FERNÁNDEZ
  • Up to 30 per cent of reservations made on the Costa del Sol for March and April have been cancelled because of the coronavirus outbreak

Earlier this week, ahead of fiercer restrictions on and advice against travel, hoteliers on the Costa del Sol were estimating losses to their businesses of two million euros so far and reporting that thirty per cent of advance reservations for March and April had been cancelled.

With the spectre of imminent financial problems in a sector worth 13 per cent of the Spanish economy, industry groups nationally were calling for urgent measures.

This cry for help was met to some extent on Thursday afternoon when Prime Minister Pedro Sánchez announced relief measures for small and medium businesses (SMEs) and the self-employed, as well as the tourism sector in general.

As part of a stimulus package worth 14 billion euros, all self-employed and SMEs will receive a six-month grace period to pay taxes due, up to certain amounts. Specifically for hotels, tourism and the transport sector, there will also be a 400-million-euro state loan service. In addition, some social security quota rules will be relaxed for companies.

For airlines fearful they will lose their valuable slots at airports if they do not fly, the government has said it will follow EU advice and be flexible. Meanwhile, Renfe, the state-owned rail operator said it will refund and change tickets without charge.

The news of the effects on the Costa tourism industry continued to arrive throughout the week. Among the most significant was the cancellation of a large conference of high-end travel agents in Marbella. The Essence of Luxury Travel congress was due to be run for the second year from 23 to 27 March with representatives attending from 64 countries.