Increasing vaccination rates for Covid-19 will help fuel the recovery in the travel and tourism industries, a panel of experts told CNBC.
Vaccinations are the only comprehensive way to combat the effects of the coronavirus, Ritesh Agarwal, CEO and founder of Indian budget hotel chain Oyo, told Nancy Hungerford during the CNBC Evolve Global Summit on Wednesday.
The global travel and tourism sector has suffered a massive slump over the past year and many airlines are still struggling to stay afloat. The coronavirus pandemic has closed borders and suspended most international travel. With vaccination rates soaring, especially in the West, many countries are slowly opening their economies and borders.
“I believe travel is here to stay. Domestic travel will lead to recovery, but vaccination is the only comprehensive and conclusive solution,” said Agarwal.
Oyo, a startup backed by SoftBank, has more than doubled its daily bookings for the summer season in Europe, where vaccination rates are relatively high, the CEO said.
Travelers tend to book rooms at hotels where staff have been vaccinated, he said, adding that Oyo issues certificates that prove their employees have been vaccinated, Agarwal said.
Asia’s vaccination campaign
In terms of vaccination rates, some of the more populous countries in Asia have lagged behind their counterparts in Europe and the US.
Information compiled by the online scientific publication Our World In Data showed that by June 15, 40% of North Americans had received at least one dose of the Covid vaccine and 36% in Europe. In comparison, in Asia, only 21% received at least one vaccination, although the vaccination rate is increasing in the region.
AirAsia managing director Tony Fernandes said he remains very optimistic about vaccination rates, especially in Southeast Asia.
“The distribution is there, the demand is there and now the supply is going to be constant,” he said, adding that he expects most Southeast Asian countries to reach 60% vaccination rates for a first dose by September.
I believe travel is here to stay. Domestic travel will lead to recovery, but vaccinations are the only comprehensive and conclusive route to the solution.
CEO and Founder, Oyo
However, he is less optimistic about the possibility of an internationally recognized vaccination record – a digital app on a smartphone that can access a person’s health data to confirm whether they have been vaccinated against Covid-19.
Support for digital health passports is split. Critics point out concerns about how secure an individual’s data will be as third-party apps communicate with databases that contain sensitive personal health information.
What the travel industry needs, however, is uniform regulation, according to the head of the low-cost airline.
Passengers crowd at the Wuhan Railway Station on the first day of the Dragon Boat Festival on June 12, 2021 in Wuhan, China’s Hubei Province.
Zhao Jun | Visual China Group | Getty Images
“If you have two vaccines, you don’t need a quarantine. That seems to be different from country to country, ”he said. Nations should also accept all vaccines approved by the World Health Organization, Fernandes added.
Important trends among travelers
Domestic travel is already on the rise in countries like China, which have managed the pandemic relatively well. Cases have remained comparatively low while the vaccination rate has increased.
Millions of people rushed to travel during a five-day Labor Day holiday in the country last month as bookings for hotels, car rentals and other trips skyrocketed.
Jane Sun, CEO of China travel booking website Trip.com, said she was looking forward to a strong rebound in domestic travel in China. “We saw a lot of catching up to do with the data on our search volume,” she said.
Sun stated that three trends can be seen among those who have been traveling again since the pandemic began.
First, they book more with hotels, airlines, and local operators who provide masks, hand sanitizer, and other security measures. Second, people are now traveling in much smaller groups. Finally, they choose flexible packages that allow them to change, cancel or postpone their trips.
AirAsia’s Fernandes agreed that the current situation requires operators, including low-cost airlines, to adapt and offer travelers more flexibility – even if it is not a sensible business choice.
“There is too much uncertainty,” he said, adding that the airline may bring back some of its older, stricter policies once it becomes safer to travel.