Opportunities for a green restart of the hotel industry arising from the COVID-19 pandemic

The coronavirus disease or COVID-19 (as officially named by the World Health Organisation, WHO) began with an initial outbreak in Wuhan, China in December 2019 and continues to cause major financial and operational disruptions in the European hotel industry. Since the beginning of the travel restrictions in Europe in March 2020, a considerable decline in arrivals of at least 50 percent at tourism establishments across all regions have occurred. Consequently, it is expected that substantial revenue loss will affect around 85 percent of European hotels. As one in ten Europeans are employed in the tourism industry, this will have even further effects on unemployment rates and social services into the coming years. At the same time, these developments force the hotel industry to put greenhouse gas (GHG) reduction efforts on hold.

This report aims to investigate the effects of the COVID-19 pandemic on the hotel industry at a national level in the focal countries of the Hotels4Climate project (Cyprus, Germany and Greece) and at an EU level. On this basis, it derives corresponding policy recommendations for a green recovery. In order to identify critical issues and gain insights into the needs of hoteliers, a market assessment was conducted and interviews were held with key stakeholders, including hoteliers, hotel associations, public bodies, consultants, tour operators and financial institutions during July and August 2020. The report is structured along three main chapters: assessment of the effects of COVID-19 on the hotel industry; initiatives for the COVID-19 recovery; and policy recommendations to support hoteliers in a shift towards sustainable tourism and GHG emission reduction.

The outcomes can be used to guide hotel industry actors and policymakers in developing new instruments as well as scaling up existing programmes to promote a green recovery of the industry.  Recommendations for the short term entail the availability of existing state aid programmes for immediate support with periodic re-evaluation as well as trainings for hoteliers on behavioural and technical measures to create rapid cost effects and integrate hygiene and safety regulations into their daily operations. In the medium to long term, soft loans and grants accompanied by a step-by-step approach for the implementation of GHG reduction measures, upgrades of existing programmes, consideration of new paradigms to develop destinations and tourism products as well as awards to highlight good practices are recommended. The period until total recovery also offers an opportunity to adjust to the developments and trends in the industry that were already apparent before COVID-19, such as the growing interest in sustainable tourism, digitalisation of the tourism experience and increased importance of authenticity and adaptation to personal needs of travellers. Therefore, the further upgrading and maturation of the tourism product needs to be based on the axes of sustainability and digital technology, necessary public infrastructure and the effective management and promotion of destinations as unique value chain additions.