Published on : Tuesday, May 5, 2020
The Caribbean Hotel and Tourism Association (CHTA) has called upon international tour operators to provide due reimbursements with immediate effect. Any tour operators having delayed payments to hotels that have provided services to their clients have been asked to clear the dues.
Frank Comito, CEO, CHTA said in a statement that Caribbean hotels and resorts are facing immense pressure due to the COVID-19 pandemic. In a letter to major trade organisations that represent the bulk of tour operators doing business in the Caribbean, he informed that nearly 69% of hotels have not received on-time reimbursements from tour operators for the services they provided around January or the first quarter of 2020.
Hotels in the Caribbean have been earlier advised to expect reimbursement by taking an average of 60 additional days, and as long as 120 days, from certain tour operators who are facing cited staff shortages, high demand, and reduced cash flow and hence facing the delay in payment. However, the global hospitality industry has been harshly impacted due to the pandemic. With additional financial dues from tour operators, the survival of many Caribbean properties especially the small- and mid-sized independent properties have been put under threat.
Comito mentioned in his written statement that the hotel industry has learned the extent to which some member tour operators are withholding reimbursements to hotels in recent weeks. He informed that these payments have been for services in January, February as well as March. He also pointed out that consumers often pay such amounts to operators many months in advance which are to be paid to the hotels shortly after the delivery of services.
He also said that the hotel industry understands the critical situation of the travel industry but mentioned that reimbursement of funds collected from consumers in advance is obligated to be paid. He further requested the international tour operator associations to help CHTA to reach out to members so that they can undertake every necessary effort to do the needful.
Comito also warned that the survival risk of some of the Caribbean hotels might also have a long-term impact on tour operator members. He shared that the reputation of the sector has already impacted the ability of many Caribbean hotels to meet their own financial obligations to employees, vendors, and Government for taxes owed related to past activity.
Over the years, business relationships with Caribbean hoteliers have been developed by tour operators and have been the key to their mutual success. He concluded saying that the betterment of the situation would be possible by equal efforts from all the parties.