Published on : Friday, June 19, 2020
On Thursday the Spanish government announced nearly 4.3 billion euro ($4.82 billion) package to provide aid to the tourism industry with the aim of helping it recover from the harsh impact of the COVID-19 crisis. The financial aid was officially declared by Spanish Prime Minister Pedro Sanchez. Tourism is an integral part of Spain’s tourism economy. However, the sector came to a standstill in light of the coronavirus pandemic.
The latest announcement arrived after Spain started to gradually lift lockdown measures and decided to open its borders to tourists from the European Union starting June 21. Spain is the world’s second-most visited country after France. It is home to nearly 80 million tourists every year. But as Spain observed one of the strictest lockdown measures in the world and restricted international and domestic travel, the tourism revenue came to down to half in the past few months.
Even now, Spain has decided to continue restricting entry for foreign tourists while many other countries in Southern Europe have already started welcoming tourists. Therefore, the financial aid has been introduced to support the tourism sector by encouraging air traffic and attracting back visitors once the restrictions are lifted. The 4.25 billion euro aid package includes €2.5 billion of provisions that have already been included in a state loan guarantee programme (ICO) that has credits offered by the governments for companies working in the tourism industry. In addition, it consists of €200 million that has been set aside for introducing safety measures and various cleaning and hygienic purposes.
The country has also decided to introduce a “COVID Safe” badge for businesses that will meet hygiene specifications. This move would ensure tourists of their safety from the risk of coronavirus infection. The government already announced the creation of a new observatory of tourism intelligence as part of the stimulus plan. The aid package would also contribute towards advertising campaigns. A PR campaign to promote ‘Safe Spain’ has already been launched in the presence of Spain’s King and Queen. Another €859m in loans have been earmarked in the package loans towards digitization, modernization and transformation to renewable energy sources.
The government will also help companies by suspending mortgage payments for up to 12 months and will grant a series of aid to pay for increased health safety measures and training for workers. The latest measures also offer a moratorium on mortgage-loan repayments for tourism businesses suffering losses as a result of the lockdown and the subsequent slow start to the tourism season. Cash transfers to state-controlled airport operator AENA to cut landing fees and other charges will also be a part of the package.
Prime Minister Sanchez mentioned that as a world leader, Spain will be taking safe steps as the country prepares to reopen for tourism. He shared that it is a matter of great delight that the epidemic situation evolved for better and allowed the country to move forward with their plan of reopening borders. He mentioned that now is the time to reactivate and stimulate the tourism industry as it is the backbone of the country and a central part of people’s way of life.