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The economic effects of the COVID-19 tourism downturn

Author

Listed:
  • Nathaniel Debono
  • Noel Rapa

Abstract

The COVID-19 pandemic has led to an unprecedented downturn in the global tourism industry. The Maltese tourism sector has also been severely hit by the crisis with total tourist expenditure in 2020 falling by 80% when compared to 2019. Given the unprecedented scale of the crisis and the considerable intersectoral linkages that characterise the industry, the downturn in the tourism industry is likely to have had far reaching effects in all sectors of the Maltese economy. The study uses a Leontief demand-driven model to estimate the overall effect that the COVID-19 related drop in tourism has had had on Maltese economic activity. Results show that the tourism drop has contributed to a 7.8% fall in overall GVA, with economic activity in sectors covering accommodation, food services activities, transportation services, agriculture, forestry and fishing and wholesale and retail trade being affected the most. The tourism industry has contributed to falls in private consumption and total exports of 6.4% and 6.2% respectively.

Suggested Citation

  • Nathaniel Debono & Noel Rapa, "undated". "The economic effects of the COVID-19 tourism downturn," CBM Policy Papers PP/08/2021, Central Bank of Malta.
    • Handle: RePEc:mlt:ppaper:0821
    as

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    File URL: https://www.centralbankmalta.org/site/Publications/Economic%20Research/2021/economic-effects-covid19-tourism-downturn.pdf?revcount=3979
    File Function: First version, 2021
    Download Restriction: no
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    References listed on IDEAS

    as
    1. Noel Rapa, 2021. "Mitigation measures, prevalence response and public mobility during the COVID-19 emergency," CBM Working Papers WP/03/2021, Central Bank of Malta.
    2. Noel Rapa, 2020. "A Sectoral Model Extension to STREAM," CBM Working Papers WP/08/2020, Central Bank of Malta.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • Z31 - Other Special Topics - - Tourism Economics - - - Industry Studies
    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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