The concept of smart cities is rapidly evolving. The diverse experiences of cities such as Sejong, Sentosa, Songdo, and Lavasa serve as blueprints for a successful city. This article analyzes their visions, strategies, best practices, and missteps to uncover insights for the future of smart urban development. Navigating Smart City Realities and Ambitions Smart cities feature innovative urban planning that leverages the latest technologies and sustainability practices to enhance residents' quality of life. They are designed without the constraints of existing infrastructure, providing a blank canvas for creating futuristic metropolises that redefine urban living. Sejong in South Korea Sejong in South Korea aimed to become an administrative capital and model city for 500,000 residents. It showcased technological advances such as ubiquitous CCTV cameras, electric buses, and self-driving cars. The master plan also included eco-friendly amenities like solar-powered homes and zero-waste systems. Sejong incorporated natural scenic amenities, including a 1.9-square-mile central park surrounding an artificial lake that serves as the city's gathering place. Additionally, the city was meticulously designed with family-friendly amenities such as parks and schools. Government offices were relocated to the new business district to appeal to residents. [caption id="attachment_12169" align="aligncenter" width="600"] Cityscape of a neighborhood in Sejong, South Korea[/caption] Sentosa Island in Singapore Alternatively, Sentosa, the resort island in Singapore, aimed to attract tourists by becoming a world-class leisure and entertainment hub. With over 240 attractions, including hotels, amusement parks, and nature trails, Sentosa caters to diverse visitors, from families and couples to corporate travelers. Sentosa's global marketing campaigns and partnerships with over 10 prominent hospitality brands have helped establish it as a premier tourist destination. It is worth noting that in its opening year of 1972, Sentosa attracted just over 2 million tourists. Areial Shot of Sentosa Island, Singapore [caption id="attachment_12170" align="aligncenter" width="624"] Areial Shot of Sentosa Island, Singapore[/caption] Songdo City in South Korea On the other hand, Songdo aimed to become a model city of the future by attracting an international community of residents and businesses. However, its top-down planning approach failed to cultivate an authentic sense of community. It was described as feeling sterile and corporate, despite its green buildings and technological advances. Unlike Sejong's focus on collaborative governance, Songdo lacked significant public participation in urban planning, resulting in a city that felt disconnected from its residents. Similarly, Songdo did not leverage the same global partnerships and diverse offerings that boosted Sentosa's appeal. Songdo's limited nightlife and restaurant options also failed to match expectations. Sentosa and Sejong focused on showcasing local culture, whereas Songdo felt placeless with its international chains and lack of character. [caption id="attachment_12171" align="aligncenter" width="580"] Songdo City Skyline, South Korea[/caption] Meanwhile, Lavasa in India was modeled after Italy's Portofino. The city struggled to get off the ground, with protracted legal and environmental disputes obstructing the construction of its planned idyllic smart city. The unfinished and legally troubled project failed to attract investors and homebuyers, leading to the abandonment and deterioration of its infrastructure. [caption id="attachment_12172" align="aligncenter" width="600"] Lavasa City, India.[/caption] The ability to execute tailored strategies matching their lofty goals would prove pivotal to the success or failure of such cities. All these cities faced the true test of making their ambitious visions a living reality by attracting their intended target populations. Ingredients for Success Beyond the Blueprint While state-of-the-art technology and urban planning are important, they are not enough. Additional key ingredients beyond the physical blueprint also contribute to the success of smart cities. Effective governance is essential for the foundation of a smart city and must be established from the outset. For example, Sentosa's development was managed by a specialized governing corporation with a clear leadership vision. This enabled smooth progress despite the massive scale and complexity of the project. In contrast, Songdo's top-down planning approach failed to involve the local community. This has resulted in a city that felt disconnected from its residents' needs. Governance Cultivating an authentic sense of civic identity and organic growth requires genuine community participation in shaping the city. Unlike Songdo, Sejong emphasized collaborative governance, where citizens actively contributed ideas to urban planning decisions. This fostered a vibrant, livable city with a strong communal attachment. Partnerships Partnerships can heighten global recognition and attract visitors. For example, Sentosa aligned with over 10 prominent hospitality brands like Resorts World, Universal Studios, and Hardrock Hotels. This amplified its profile and established its reputation as a premier tourist destination. Moreover, the ability to adapt offerings to changing societal preferences prevents stagnation after the initial novelty wears off. By constantly assessing and strategically updating its many attractions, Sentosa continued to attract visitors, even after surpassing 1 million visitors in 1979. New offerings, such as world-class sporting events and refreshed leisure facilities, provided repeat visitors with exciting new experiences. Transport Infrastructure Accessibility and mobility are also key factors in determining whether target communities can reside in or visit cities. Sejong's central location in South Korea allows for easy transportation access from all corners of the country, while Lavasa's remote hilltop location presents challenges for visitor access. It is essential to build comprehensive transit networks with links to major transportation hubs. Operational excellence is also crucial for cities that rely heavily on tourism, as it creates seamless user experiences. Sentosa demonstrated its ability to enhance guest satisfaction and streamline operations through its suite of technology solutions, such as mobile apps and information hubs. Strong behind-the-scenes service delivery and infrastructure are equally important. Additional Best Practices for Smart City Success In addition to those core ingredients, specific best practices underlie many of the achievements of truly thriving smart cities. Unique architectural landmarks can foster distinctive character and community identity. Sejong Lake Park became a scenic central hub and gathering place for civic life. Hosting renowned high-profile cultural, sporting, and entertainment events generates significant global visibility and prominence. The major tournaments held annually, such as the SMBC Singapore Open and the HSBC Women’s World Championship at Sentosa, consistently bolstered its international reputation. Targeted marketing campaigns, like customized trip itineraries, promote and expand visitor access to attractions and amenities. Sejong offers curated travel packages that highlight the city's assets; Sejong Lake Park, Sejong Barrage, and Milmaru Observatory are some examples. Smart cities can create unique and vibrant communities by leveraging a variety of transportation options, natural features, land-use strategies, cultural attractions, and amenities. For example, Sentosa integrated diverse transportation modes like roads, metro, cable cars, and shuttles to overcome accessibility challenges from its island location. Songdo's extensive parks and waterfronts demonstrate how natural assets can be better utilized with careful planning. Strategically zoned areas like innovation and research hubs, as seen in Lavasa's planned technology district plans, nurture growth in target industries. Special economic zones with incentives also encourage business investment, as Songdo's designated zones aimed to do. Meanwhile, cultural components like museums, galleries, and public art, as incorporated in Sentosa and Sejong, foster community cohesion. Maintaining high-quality healthcare, education, housing, and recreation enhances livability for residents, as cities like Sejong have prioritized. Taking a comprehensive approach allows smart cities to cultivate distinctive identities and opportunities. Thoughtful Phased Development Phasing development in a thoughtful and staged manner is key to achieving smart city success sustainably over the long term. Unrealistic, rushed timelines often set cities up to fall short of expectations and struggle down the line. Sentosa progressed systematically through multiple stages of gradual development spanning from the 1970s to today, carefully adapting, expanding, and updating as it grew. New cities should focus first on building critical mass and a high baseline quality of life for initial residents before pursuing aggressive rapid expansion. Gradually layering in new zones, industries, attractions, and amenities in phases enables organic, sustained growth rather than sudden, unsustainable booms. Securing substantial buy-in and commitments from target resident demographics, investors, businesses, and the government is also essential before breaking ground on massive new developments. Beginning construction without secured commitments risks creating ghost cities and bankruptcies. Sejong brought stability by confirming the relocations of national government agencies and associated populations. Sentosa extensively marketed itself globally to its target tourist base for years before opening. Sufficient early-stage funding and investment are also key; Lavasa's inability to raise the necessary capital stalled its progress indefinitely. Thorough upfront planning and consensus pave the way for smart cities to successfully thrive. Key Takeaways In conclusion, the success of a smart city depends on aligning its vision with long-term strategies for governance, community building, partnerships, attractions, adaptability, accessibility, operations, and more. While state-of-the-art technology and infrastructure are important, inclusive holistic planning that encompasses social, cultural, economic, and environmental factors is equally critical to build the foundations necessary for vibrant, future-ready cities to sustainably prosper. The way forward necessitates detailed and comprehensive planning that prioritizes people, with technology serving as a facilitator rather than the main focus. These lessons provide guiding principles and best practices for transforming ambitious plans into tangible, livable smart cities that stand the test of time. References: https://www.mapsofindia.com/my-india/government/lavasa-from-a-dream-to-a-failed-city https://www.indiatoday.in/newsmo/video/lavasa-what-went-wrong-with-india-s-paradise-hilltop-city-1962752-2022-06-15 http://www.lavasa.com/play/getting-there.aspx https://www.bloomberg.com/news/articles/2018-06-22/songdo-south-korea-s-smartest-city-is-lonely https://www.sejong.go.kr/eng/sub03_0201.do https://smartcity.go.kr/en/2022/08/25/designing-tomorrow-sejong-national-pilot-smart-city/ https://loti.london/blog/what-can-london-learn-from-south-koreas-smart-cities https://www.sejong.go.kr/eng/sub04_0101.do https://www.mdpi.com/2071-1050/14/2/630 https://www.visitsingapore.com/see-do-singapore/places-to-see/sentosa/ https://www.sentosa.gov.sg/partner-us/opportunities/ https://www.thomascook.in/places-to-visit/sentosa-island-in-singapore-3915 https://edition.cnn.com/travel/article/sentosa-island-singapore-history-cmb/index.html
At a time when some travel industry forecasts had begun to express optimism that the sector could expect a full recovery by the end of the year, or early 2022, the new Omicron variant has dashed all such hopes. Once again, the world finds itself confronted with a new COVID-19 variant that is spreading globally at alarming rates, and countries have been forced into immediate action to limit further spread of the highly contagious variant. As more restrictions are imposed, travel in general, and leisure travel in particular has become extremely challenging. This is especially true for those traveling from countries with skyrocketing infection rates. At Infomineo, we previously published an article and research on how COVID-19 impacted the travel & tourism industry globally, in which we plotted the major effects of the pandemic on several tourism sectors. In this article, we aim to shed light on the travel restrictions being put in place following the emergence of the Omicron variant, by highlighting recent restrictions enacted in selected countries. Detection and Early Development Omicron was first identified in late November by South African scientists, who reported the variant to the World Health Organization (WHO). On 26 November 2021, the agency designated the variant B.1.1.529, or Omicron, a variant of concern, on the advice of its Technical Advisory Group on Virus Evolution. The origins of the new variant remain uncertain, however, with the National Institute for Public Health and the Environment in the Netherlands, reporting that retests of samples taken on Nov. 19 and 23 found that Omicron was already in the Netherlands before South Africa reported it to WHO. In a statement released December 1, Nigeria's national public health institute announced it had detected the country's first omicron case in a sample that was collected in October. As of December 16, Omicron had been detected in 89 countries, with coronavirus cases involving the variant doubling every 1.5 to 3 days, according to the World Health Organization. Impact on Travel & Tourism As a result of the new variant, travel & tourism have been severely disrupted. Just days after Omicron was identified, several countries had already closed their borders to halt the spread of the virus. Many countries first reacted by restricting travel from South Africa. Some governments, including those of the US, and all 27 member states of the European Union, broadened these restrictions to include seven other countries in the region, having deemed them high-risk areas where the Omicron variant is spreading rapidly (Namibia, Zimbabwe, Botswana, Mozambique, Eswatini, Malawi, and Lesotho). Travel restrictions are no longer limited to travelers from southern Africa, however, with many countries around the world putting in place wide-ranging restrictions and regulations to limit the spread of the virus: Sweden has introduced a new testing protocol for all travelers regardless of their vaccination status and country of origin, with the decision coming into effect on December 28. Germany has imposed a mandatory 14-day quarantine on all travelers arriving from the UK, which began on December 20. Israel added the US to its list of "red countries”, on December 20, along with Belgium, Germany, Hungary, Italy, Morocco, Portugal, Switzerland, and Turkey. This designation means that Israeli citizens and permanent residents are banned from traveling to those countries unless they get a special exemption and that all travelers from those countries must quarantine on arrival, regardless of vaccination status. France imposed tighter restrictions for travel between the U.K. and France, requiring "compelling reasons" for such travel — tourism and business do not qualify under the changes. South Korea has restricted flights from eight countries. Thailand Singapore and Japan have closed their borders to most foreign travelers. The countries listed above are only a sample of those that have taken immediate action to halt the spread of the new Omicron variant. As the situation continues to evolve, many more countries are imposing travel restrictions and updating those already in place. While it is unclear exactly how long travelers, or the industry, can expect such restrictions to continue, it seems safe to assume that travel will be greatly affected for some time to come. Author: Mohamed Aref Sources: https://www.who.int/news/item/28-11-2021-update-on-Omicron https://www.cdc.gov/coronavirus/2019-ncov/variants/ https://www.advisory.com/daily-briefing/2021/12/03/Omicron-origins https://www.cnbc.com/2021/12/20/Omicron-casts-a-shadow-over-winter-holidays-as-countries-mull-strict-restrictions.html https://edition.cnn.com/travel/article/Omicron-hitting-travel-to-europe/index.html https://edition.cnn.com/2021/11/29/world/covid-Omicron-variant-countries-list-cmd-intl/index.html https://www.dw.com/en/Omicron-which-countries-have-closed-their-borders/a-59979182 https://www.dw.com/en/Omicron-present-in-netherlands-earlier-than-thought-say-health-authorities/a-59977047 https://www.npr.org/2021/12/20/1065865472/Omicron-holiday-travel-gatherings-restrictions-world https://www.forbes.com/sites/roberthart/2021/12/01/omicron-case-in-nigeria-dates-back-to-october-weeks-before-it-was-first-reported-in-south-africa/?sh=1417301f2abc https://www.dw.com/en/eu-states-agree-to-suspend-travel-from-southern-african-nations-over-new-coronavirus-variant/a-59942074 https://www.who.int/docs/default-source/coronaviruse/20211217-global-technical-brief-and-priority-action-on-omicron_latest-2.pdf?sfvrsn=bdd8297c_9&download=true https://www.bbc.com/news/world-europe-59713503 https://apnews.com/article/coronavirus-pandemic-health-middle-east-canada-israel-689d0084dc4b2c48df86902b096343ab https://www.ft.com/content/2642cd6a-c35d-40e5-8300-77f4423113ba https://www.schengenvisainfo.com/news/sweden-introduces-testing-requirement-for-all-travellers-regardless-of-vaccination-status/
The Challenge of Post-Pandemic International Travel International leisure travel in the post-pandemic world poses challenges to travelers ranging from PCR tests and vaccination requirements prior to departure, to quarantine periods and local safety protocols once they’ve arrived at their destination. At Infomineo, we previously published an article on how COVID-19 impacted the global travel and tourism industry, in which we outlined the major effects of the pandemic on the different tourism sectors. In this new study, we analyzed the arrival statistics of different countries, alongside the travel restrictions they put in place, allowing us to identify several trends among countries that have lifted all COVID-19 travel restrictions, and key differences between them and the countries that have maintained said restrictions. We examined the number of visitors to four countries, two of which reopened their borders post-lockdown with no COVID-19 travel restrictions in place, and the other two of which maintain travel restrictions to the current day. We grouped the countries into color groups as indicated below. Group 1: Countries with no travel restrictions: Mexico & Albania – Blue Group The first country in this group, Mexico, is one of the world’s top tourist destinations, with 95-99 million visitors annually. The second, Albania, has not historically received such high levels of visitors. Group 2: Countries with travel restrictions: Spain & Italy – Red Group The countries in this group traditionally rank among the top-visited countries worldwide, with each of Spain and Italy expecting around 82 and 65 million annual visitors respectively. We set out to examine how each set of countries has fared in terms of recovering previous numbers of visitors and looked at the number of monthly visitor arrivals to all four countries—both pre & post-lockdown—to discern arrival trends and provide you with the relevant insights. How Lifting Covid-Restrictions Aids in the Quick Recovery of Tourist Arrivals Having examined the tourist arrival figures in the countries selected, it appears that international travelers currently favor destinations with minimal or no COVID-19 restrictions, over those with such restrictions in place. This is clearly visible in the case of Albania, which opened its borders to travel in 2020 and implemented a visa-free initiative in 2021. Global tourism giant, Mexico, also witnessed a quick resurgence in tourist arrivals after reopening its borders, averaging 81% of their pre-pandemic monthly visitors during the peak season of 2021. Albania Despite its rich archaeological sites, pristine beaches, and low prices, Albania has not historically figured among the top travel destinations for many countries. We leveraged the country’s tourism statistics and concluded that most of Albania’s tourist arrivals are from its neighboring border countries (Kosovo, North Macedonia, Italy & Greece). In May 2020, Albania reopened its borders to welcome back tourists after the country reported no new coronavirus deaths for more than three consecutive weeks. In April of the following year, Albania announced that it would permit visa-free travel, through December 31st, 2021, to citizens of Bahrain, Egypt, Oman, India, Qatar, Russia, Saudi Arabia, and Thailand. The new initiative allowed citizens of these countries to visit Albania, without the need to obtain a visa nor the need to present negative PCR test results on arrival. After the country implemented its free-visa initiative, the number of tourist arrivals during its high season in 2021 reached 97.7% of the tourist flows registered in 2019. The share of visitors from new markets increased from 8.4% prior to the outbreak of the pandemic, to 19.1% in 2021, with new market visitors taking advantage of the absence of visa and COVID-19 travel restrictions to Albania. We interviewed Geri Cakoni, head of sales for the inbound-tourism company Good Albania, who explained that the initiatives provided much-needed relief in terms of incoming tourism. This was especially true, he highlighted, for the first few months after reopening, when tourism figures were stale and the countries from which travelers usually arrived were still reluctant to open to Albania for tourism. He explained further that his company witnessed a dramatic increase in the number of inquiries from middle eastern travelers and estimated that 20-30% of his company’s clients this year have been a direct result of the visa-free entry initiative. Mexico Thanks to its vivid landscapes, coastal resorts, cultural festivals, and archeological ruins, Mexico has consistently ranked among the world’s top visited countries globally by the number of tourist arrivals. In March 2020 it closed its borders to travel due to the international lockdown, and an increase in COVID-19 cases locally. It reopened for tourism in July of the same year, however, and did so without putting any COVID-19 restrictions on travelers in place. In July 2020, shortly after opening for tourism, the country recorded tourist flows of 1.3 million visitors (around 33% of pre-pandemic rates). By December, the number of tourists reached 2.6 million (55% of pre-pandemic rates). Because these figures were recorded during mid and late 2020, we believe that the low figures were due to the international lock-down and travel restrictions from the source markets. In 2021, the number of visitors increased to between 1.6 and 3.3 million tourists monthly, representing a recovery rate as high as 81% in June & July 2021, when compared to 2019 tourist arrivals. The country appears to be well on its way to pre-COVID 19 levels of tourist arrivals due to its early border reopening and the non-imposition of travel restrictions. Are Top Tourism Destinations Still in Pole Position? In the second part of our study, we examined the arrivals of tourists to Spain and Italy, two of the most popular tourist destinations globally. Spain receives around 82 million visitors annually while Italy welcomes 65 million tourists, on average, per year. Due to their delayed border reopening, however, coupled with tight COVID-19 restrictions & requirements, both still struggle to recover pre-pandemic levels of tourist arrivals. Both countries allow only vaccinated visitors and require that these same visitors present proof of a negative PCR test before departure from their home countries. Because both countries also lie within the EU, their border openings are further subject to EU regulations. Spain Spain suspended tourism and travel in March 2020. In the following 2 months, April & May, inbound traffic held stable at zero with airports in the country remaining shut down. Arrivals to the country increased as restrictions were eased to permit necessary travel in May 2020, but these figures would not have included any tourist visitors. When EU travel borders reopened in June 2021 and Spanish borders were opened to vaccinated foreign travelers, traveler arrival figures failed to rise as dramatically as they had in the blue group countries. The number of inbound tourist arrivals increased from 400k-600k in early 2021, to 2.2, 3.4, and 5.2 million tourists in June, July, and August respectively. Despite the increase in tourist arrivals, these figures represent only about 40% of the 2019 figures through its high season. Italy Italy’s tourist arrival figures plot a similar trajectory to that of Spain, albeit with lower figures. Prior to the pandemic, Italy received between 3-5 million tourists during its low seasons and 6-8 million tourists during its high season travel months. Italy reopened its borders in June 2021 with arrivals that month reaching around 1.8 million. In July 2021, that number increased to 3.1 million. That translates to a recovery rate of 27%, 35%, and 62% of pre-pandemic figures for its high season months of June, July & August 2021 respectively. Outlook Although both Spain & Italy have reopened their borders to tourism, there remains great potential in reactivating their tourism sector due to their long-held positions at the top of the global tourism standings. Nevertheless, they are unlikely to quickly return to pre-pandemic levels of arrivals, due to their late border reopening & the COVID-19 travel restrictions currently in place. While countries with strict travel restrictions struggle to recover their pre-pandemic numbers of visitors, those without such restrictions in place can expect to continue to see rising recovery rates. Just how long they can expect to do so, however, and whether they can expect to see their number of monthly arrivals eclipse previous records, remains to be seen. Author: Mohamed Aref Disclaimer All calculated figures are Infomineo’s team analysis. All inbound tourism figures refer to visitors for the purposes of vacation or holiday. (Arrivals>Tourist>Leisure) High-season touristic months are calculated by Infomineo according to the seasonality charts provided by the UNWTO Glossary Arrivals: Includes the total number of entries from all border crossings (air, sea, and land) Tourist: Any visitor who spends at least one night at a destination country (regardless of accommodation type) High Season: The months in which a country usually receives the highest number of inbound travelers. Raw Data To access the raw data and sources used, along with the team’s calculations, click here to download the file Interested in capturing your project-specific travel & tourism data? Get in touch with our team!
Ever Given ship was not allowed to depart from Suez Canal unless the vessel’s owners pay up to $1 billion to compensate for the enormous disruption it resulted in. Ever Given’s Ship Blockage Causes the World’s Heaviest Traffic Jam. On the 23rd of March 2021, the Ever Given was sailing through the Suez Canal. Strong winds whipped up by a sandstorm affected the steering of the ship causing it to turn into the banks blocking the entire span of the canal. The blockage of the Suez Canal brought a lot of attention to the global maritime importance of this passage. In this article, we look at the various negative effects the Ever Given caused and also shed light on other interlinked questions, mainly, how big is the global maritime trade transport market? Are there penalties imposed on the Ever Given Vessel? Are there other canals that are considered key trade passages? Is this the first time the Suez Canal was blocked? How Important is the Suez Canal and what are the canal’s investments/projects? Global Maritime Trade Transport & Key Choke Points A sole country can’t be entirely self-sufficient. Shipping helps ensure that the benefits of trade and commerce are evenly spread. Almost every country relies on maritime trade to buy its necessities and sell its products. Maritime transport is the backbone of international trade and the global economy: almost 80% of global trade by volume is carried by sea and is handled by ports worldwide. Because of its importance, commercial shipping relies on strategic trade routes to move goods efficiently. A vast number of vessels use these waterways every year, but it does not always go smoothly as there are risks that can disturb the whole system. The most serious risks to global trade are posed by choke points which are strategic, narrow passages that connect two larger areas to one another. When it comes to maritime trade, these are typically straits or canals that see high volumes of traffic because of their optimal location. Although these vital routes are very convenient, they impose several risks: Structural risks: As demonstrated in the recent Suez Canal blockage, ships can crash along the shore of a canal if the passage is too narrow, causing traffic jams that can last for days. Geopolitical risks: Because of their high traffic, choke points are particularly vulnerable to blockades or deliberate disruptions during times of political unrest. The location affects the risk type and degree. Below are listed the biggest threats concerning 8 of the world’s major choke points. Is the Suez Canal the Only Maritime Artery? What Do Other Maritime Passages Mean to the World? Global Maritime canals and straits shorten navigation time of transport of cargoes and contribute to reducing transport costs. Despite the most recent crisis, Suez is not the most vulnerable bottleneck for world trade. Ever Given is not the First Ship to Block the Suez Canal The Suez Canal has been blocked and closed several times since its opening in 1859. According to the Suez Canal Authority, the Canal has closed 5 times since it opened for navigation in 1869: 1956, after a British-French-Israeli invasion. That tension following the Egyptian President’s announcement of nationalizing the canal led to its closure for months 1967, Egypt enters a war with Israel and the canal closed for 8 years 2004, the Tropic Brilliance oil tanker got jammed in the waterway which took 3 days to refloat and sail again 2006, the Okal King Dor drifted at a wrong angle and got jammed leading to a temporary blockage in the canal for 8 hours 2017, OOCL Japan malfunction caused the ship to to block the canal but the tugboats freed the ship in a few hours In comparison with the 5 previous incidents, the Ever Given falls in the middle in terms severity. The Ever Given’s Blockage tragically affected Global Economy & Maritime Flow In less than a week, global trade has been tremendously affected by this incident. Although the ship was freed and floated on March 29th, the canal could not immediately process full traffic flow. The blockage has been the source of much worry and frustration for the global shipping industry. Waiting Vessels since the blockage: More than 300 ships waiting in and around the Suez Canal Upcoming Vessels: 130 vessels were on their way to the canal Global Oil & Gas: An average of 12% of global trade, around one million barrels of oil and roughly 8% of liquefied natural gas pass through the canal each day Egypt’s losses due to the damage: The Suez Canal Authority Chairman stated that the Canal’s blockage results in revenue losses averaging $14m-$15m for each day Delayed Cargo: Estimated $9.6bn of trade along the waterway each day. That equates to $400m and 3.3 million tons of cargo an hour, or $6.7m a minute Global Trade: Allianz’ analysis showed the blockage could cost global trade between $6bn to $10bn a week and reduce annual trade growth by 0.2 to 0.4 percentage points How was the ship freed? The main obstacle in re-floating the ship once again from the Suez Canal bank was its enormous size. The ship is 400 m (1,312 ft) long, 59 m (194 ft) wide while the canal itself is only 200 m wide (656 ft). This vast size comes with a massive weight as well, the ship weighs around 200,000 tons. A 24/7 emergency effort was put into place to get the shop back on track. 3 main forces were used in the strategy to free the boat. Dredgers clawed away underwater sand, Excavating equipment was used to dig out the keel of the ship, Tugboats, were used to push and rotate the ship and pull it with tow lines. Ever Given ship is forbidden to leave the Suez Canal Egyptian authorities reported they wouldn't release the vessel unless its owners agree to pay up to $1 billion in compensation. Osama Rabie, who leads the Suez Canal Authority reported “Egyptian authorities would demand $1 billion to cover the costs of freeing the vessel. The figure will cover the expense of the equipment and machinery used to clear the way, the damage to the canal itself, and the compensation of the 800 people who worked to release the 200,000-ton ship. It will also refund the costs from the blocking of the canal, which ended up causing an epic traffic jam of more than 300 ships on either side of the channel.” Is it Ever Given or Evergreen? There was some confusion occurred regarding the name of the ship as news outlets started calling the ship “Ever Given” while the name “Evergreen” was prominently painted on the side of the ship in large capital letters. Ever Given is the name for the ship, and the ship is operated by a Taiwanese company called Evergreen Marine. Careful observers or sailing aficionados will notice that Ever Given is also written on the ship at the bow and stern of the vessel in smaller lettering. Global Repercussions VS Egypt’s Efforts & Its Worldwide Recognition At the beginning of the incident, maritime experts globally warned that it may take weeks to dislodge the Ever Given and that the blockage would last for a long time. However, thanks to the effort of the Suez Canal Authority and the support from the government, the ship was refloated within less than a week. Egyptian officials said that the backlog of ships waiting to transit through would be cleared in around three days. Evergreen thanked the Suez Canal Authority and other concerned parties for managing to successfully release the mammoth. Several countries also extended their congratulations to Egypt as they watched with bated breath how this problem was resolved. Investments in Suez Canal Investments in the Canal. The Suez Canal has been receiving investments to its economic zone and for canal renovation. In the last 5 years, Suez Canal Economic Zone (SCZone) investments hit more than 15 billion dollars. In the same timeframe, over 220 companies from different industrial sectors were established at the SCZone. The strategic role in promoting trade exchange between Egypt and other regional and African countries was aided by Egypt’s national road network developments and the Cairo-Cape Town road project. Governance. SCZone will establish a subsidiary company to work as an investment and commercial arm to channel funds for projects along the Canal Opportunities in the Canal. With investments more than $15 Billion, the SCZone gathers 14 industrial developers, 247 operational establishments, covering 239 sqms of land that creates 70,000 job opportunities. Resources. The canal has a strong infrastructure that includes 7 power stations and 13 power-distribution units, 2 desalination plants and 2 water-treatment plants, establishing tunnels and bridges to support the transportation network, and expanding the telecommunications and natural-gas networks. Future Investments. Suez Canal Container Terminal (SCCT) aims to invest $60 million during 2021 to enhance the competitiveness of the container handling terminal at East Port Said Port. The company’s investments are currently estimated at over $900 million. The new investments aim to add 6 giant cranes to increase the total number to 12, in addition to increasing the number of yard winches from 50 to 60-yard winches. References: https://www.businessinsider.com/ever-given-forbidden-leave-suez-canal-until-owners-pay-compensation-2021-4#:~:text=Ever%20Given%20ship%20forbidden%20to,for%20the%20chaos%20it%20caused&text=The%20Ever%20Given%20can't,are%20paid%2C%20officials%20said%20Thursday.&text=The%20owner%20of%20the%20Ever,heard%20from%20Egyptian%20authorities%20yet. https://www.bbc.com/news/world-middle-east-56567985#:~:text=Traffic%20has%20resumed%20in%20Egypt's,with%20the%20help%20of%20dredgers. https://www.bbc.com/news/business-56559073 https://www.bbc.com/news/56523659 https://www.visualcapitalist.com/mapping-the-worlds-key-maritime-choke-points/ https://www.dw.com/en/suez-canal-blockage-4-of-the-biggest-trade-chokepoints/a-57020755 https://unctad.org/webflyer/review-maritime-transport-2018#:~:text=Maritime%20transport%20is%20the%20backbone,are%20handled%20by%20ports%20worldwide. https://www.npr.org/2021/03/26/981600153/heres-how-a-long-shutdown-of-the-suez-canal-might-roil-the-global-economy CNBC Television News https://www.usatoday.com/in-depth/graphics/2021/03/29/ever-given-refloated-and-freed-how-did-they-get-the-ship-out-of-the-suez-canal/7043678002/ https://www.usatoday.com/in-depth/graphics/2021/03/26/how-evergreens-ship-got-stuck-in-the-suez-canal/7010375002/ https://www.ctvnews.ca/business/ever-given-or-evergreen-what-s-the-actual-name-of-the-suez-ship-1.5366697 https://www.egypttoday.com/Article/1/100302/Evergreen-Line-thanks-Suez-Canal-Authority-for-refloating-its-stuck https://www.nytimes.com/2021/03/26/business/suez-canal-blocked-ship.html https://www.france24.com/en/tv-shows/business-daily/20210326-vessels-start-diverting-amid-warning-suez-canal-blockage-may-last-for-weeks https://www.france24.com/ar https://www.un.org/press/en/2016/sgsm18129.doc.htm https://english.ahram.org.eg/NewsContent/50/1202/359583/AlAhram-Weekly/Economy/More-investment-in-the-Suez-Canal-Zone.aspx https://english.ahram.org.eg/NewsContent/3/12/379611/Business/Economy/Investments-at-Suez-Canal-Zone-hit-bln-in--years,-.aspx https://www.hellenicshippingnews.com/suez-canal-containers-aims-to-invest-60m-during-2021/
The Travel and Tourism Industry The travel and tourism industry has experienced unprecedented growth over the past decades, becoming one of the fastest-growing economic sectors worldwide. This sector's expansion underscores its significant socio-economic contributions and resilience amidst global challenges The sector witnessed a 59% growth over the decade in international tourists’ arrivals from 1.5 billion 2019 compared to 880 million in 2009. Tourism is also a key driver for socio-economic progress, with tourism specific developments in an increasing number of national and international destinations. Globally, the tourism industry contributed to $8.9 trillion to the global GDP in 2019 equaling a contribution of 10.3%. It is also to note that 1 in 10 jobs around the world is in tourism, equaling 330 million jobs. However, the strong historical growth has been halted in 2020 amid the global Covid-19 pandemic. With airplanes on the ground, hotels closed and travel restrictions implemented, travel and tourism became one of the most affected sectors since the very start of the virus spread. The pandemic has cut international tourist arrivals in the first quarter of 2020 to a fraction of what they were a year ago. Closing borders, tourism & travel ban Countries all over the world applied travel restrictions to limit the coronavirus spread. Airport closures, the suspension of incoming and outgoing flights, and nationwide lockdowns are just some of the measures that countries are implementing in an effort to help contain the pandemic. After the spread of the pandemic in the first two quarters of 2020, at least 93 percent of the global population lived in countries with coronavirus-related travel restrictions, with approximately 3 billion people residing in countries enforcing complete border closures to foreigners. The decline of International Tourists during the Pandemic The number of international tourist arrivals has been growing remarkably in the last decade and still sustained growth throughout the last years; in 2017 arrivals reached a total of 1.3 billion globally, 2018 reaching 1.4 billion and 1.5 billion in 2019. In 2020, and with the severe impact of the COVID-19 Pandemic, international tourism went down by 22% in Q1 and by 65% in the first half of 2020 when compared with 2019 figures. In March 2020, the UNWTO proposed 3 scenarios for possible declines in arrivals of 58% to 78% for 2020 depending on the start point of gradual opening of borders and lifting travel restrictions. [caption id="attachment_5343" align="aligncenter" width="446"] 2020 Forecast (Updated)[/caption] [caption id="attachment_5344" align="aligncenter" width="447"] 2020 Forecast[/caption] According to the UNWTO’s March forecast and its September update, the recovery for the industry might be in 2021 and domestic demand is expected to recover faster than international. In May 2020, the majority of the UNWTO tourism experts expect to see signs of recovery by the final quarter of 2020 but mostly in 2021. Covid-19 and Airline Failures The International Air Transport Association (IATA) financial outlook released in June showed that airlines globally are expected to lose $84.3 billion in the year of 2020 for a net profit margin of -20.1%. It also stated that revenues will fall by 50% to $419 billion from $838 billion in 2019. In 2021, losses are expected to be cut to $15.8 billion as revenues rise to $598 billion. IATA’s Director General and CEO, stated that “Financially, 2020 will go down as the worst year in the history of aviation. On average, every day of this year will add $230 million to industry losses. In total that’s a loss of $84.3 billion”. What’s shocking is witnessing how many airlines have failed during the coronavirus pandemic. And even for airlines that are still in business, the situation is severely difficult: e.g. the US carriers have given out $10 billion in vouchers due to the pandemic. Listed below are a few examples of the biggest coronavirus-related airline failures worldwide. - LATAM: To date, Chile’s LATAM is the largest airline to file for U.S. bankruptcy protection in May due to the pandemic. LATAM says it will continue flying as it restructures its debts in bankruptcy court. - Avianca Holdings: The second-largest carrier in South America, Avianca survived the Great Depression - but not coronavirus. The airline filed for Chapter 11 bankruptcy protection in May. Like LATAM, Avianca will continue flying during the restructuring. - Virgin Australia: After almost 20 years of operation, Virgin Australia - the country’s second-biggest airline - filed for voluntary administration, the equivalent of bankruptcy restructuring. It’s the largest airline to collapse in Australian history. - Flybe: The British regional airline Flybe was already struggling before coronavirus and both the UK government and Virgin Atlantic tried to save it. However, the airline entered voluntary administration, similar to bankruptcy, in March. - Miami Air International: After 29 years in service, Miami Air International filed for Chapter 11, then proceeded to cease operations. Hospitality Sector Hit by the Lockdown The lockdown due to the pandemic has affected the tourism industry across the globe, and the hotel sector is among the hardest hit. Global hospitality data company STR compared 2020’s first quarter status to 2019 figures, hotel occupancy rates dropped as much as 96% in Italy, 68% in China, 67% in UK, 59% in USA and 48% in Singapore. There’s no doubt that the hotel industry has witnessed a severe impact by the pandemic and the lockdown status. STR is also comparing U.S. Hospitality statistics between 9th of May 2020 to 11th of May 2019 and reported a sharp decline in global hotel performance indices: - 55.9% decline in occupancy to 30.1% - 42.1% decline in average daily rate (ADR) to $76.35 - 74.4% decline in revenue per available room (RevPAR) to $22.95. Balancing the Return of Tourism Revenues and Safety As of July 2020, the EU opened borders to tourists from 15 different countries leaving the U.S. off the list. Health officials developed a plan to classify accepted countries based on how the country is performing in controlling the coronavirus. A country is considered under control when they have a number close to or below the EU average for new coronavirus cases over the last 14 days and per 100,000 inhabitants. On 15 June, the European Commission launched ‘Re-open EU’, a web platform that contains essential information allowing a safe relaunch of free movement and tourism across Europe. The platform will provide real-time information on borders, available means of transport, travel restrictions, public health, and safety measures. Safe Tourism Enabling tourism once again would require measures ensuring that people are and feel safe towards traveling. Global safety and hygiene stamps are awarded by the World Travel & Tourism Council (WTTC) to countries that are demonstrating their commitment to reopening their tourism sector as they recover from the coronavirus outbreak. The WTTC, a council that represents private-sector travel and tourism, created the Safe Travels Stamp to allow tourists to recognize governments and companies around the world which have adopted health and hygiene global standardized protocols – so consumers can experience ‘Safe Travels’. Eligible entities such as hotels, restaurants, airlines, cruise lines, tour operators, attractions, short term rentals, car rentals, outdoor shopping, transportation and airports, will be able to use the stamp once the health and hygiene protocols, outlined by WTTC, have been implemented. As of September 2020, the ‘Safe Travels’ List included 100 destinations with Saudi Arabia, Spain, Portugal and Mexico among the first destinations to adopt the stamp and the Philippines as 100th destination. The Return of Tourism Globally With lockdowns ending around the world, many countries have started to ease border restrictions and reopen for international tourists. Although many governments are still advising against "nonessential" international travel, a host of popular destinations have eased their Covid-19 border restrictions and are readily welcoming tourists back: - The European Commission has released guidelines for how its Member States can start to ease coronavirus travel restrictions and enable tourism to begin again - The Baltic states are creating a “travel bubble”, allowing citizens to travel freely between them. - New Zealand and Australia have committed to introducing a trans-Tasman "COVID-safe travel zone", as soon as it’s safe to do so - Destinations like Dubai, the Maldives, Egypt, Lebanon, Croatia, Kenya, Tanzania and Jamaica have already opened their doors to foreign visitors again, while Thailand hope to reopen soon While tourism is slowly returning in some destinations, most members of the UNWTO Panel of Tourism Experts expect international tourism to recover only by the second half of 2021, followed by those who expect a rebound in the first part of next year. However, there are still concerns over the lack of reliable information and deteriorating economic environment which are indicated as factors weighing on consumer confidence, especially with the potential new limits on travel as world comes to grips with second Covid-19 wave. The concerns over the “second wave” of coronavirus brought on by returning vacationers are wreaking havoc on the world’s tourism industry. 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