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The Conflict In Ukraine Threatens To Derail Southeast Asia’s Fledgling Tourist Rebound

The Conflict In Ukraine Threatens To Derail Southeast Asia's Fledgling Tourist Rebound

Image Source: Global Voices

Bali, Indonesia — The island of Bali is a popular tourist destination. Those in the travel sector are concerned that the conflict in Ukraine would impede the much-anticipated revival of tourism-dependent economies in Southeast Asia, which is taking place when COVID-19 travel restrictions are being eased throughout the region.
Countries such as the Philippines, Laos, Cambodia, and Thailand have recently opened their doors to tourists who have received vaccinations, although with expensive and time-consuming procedures. Earlier this month, Indonesia stated that it would resume quarantine-free travel in Bali by March 14, while Vietnam declared it would reopen to visitors on March 15.
Nearly two-thirds of travel experts responded to the most recent World Tourism Organization (UNWTO) Panel of Experts poll, which reported that lowering border restrictions and encouraging statistics from 2021 drove their optimism for the following year.

According to the United Nations World Tourism Organization, global tourism earnings would exceed $1.9 trillion in 2021, representing a 19 percent increase over the previous year. According to the International Air Transport Association, worldwide passenger traffic increased by eight percentage points in 2019, with demand down by 58 percent compared to the previous year – however, the Asia Pacific region’s recovery trailed behind other areas.
Although projections in the region have been dampened by the conflict in Ukraine, sanctions against Russia, and airspace restrictions, the area has seen Russians become the largest and most spendthrift group of visitors to many top destinations during the pandemic, displacing Chinese who were unable to travel because of their country’s strict border controls.
Popular tourist destinations such as Thailand’s island resort of Phuket, where Russians accounted for 51,000 visitors out of the 278,000 foreigners who visited the island between November and February, according to data from the Tourism Authority of Thailand (TAT), are already feeling the effects of the crisis.

“We have spoken to several hotels who have reported a high number of cancellations as a result of decreased air traffic,” Bill Barnett, head of C9 Hotelworks, a Phuket-based consultant, told Al Jazeera.
Since the drop of Chinese tourists, according to Gary Bowerman, a travel expert based in Kuala Lumpur, Russian travelers have become a key market for locations such as Thailand, Vietnam, and Indonesia’s island of Bali, among others.

Oil Prices Are On The Rise

As a consequence of the crisis, tourists from Russia and Ukraine will not be the only ones who will face additional difficulties while traveling to Southeast Asia.
Russia contributes for around 10% of the world’s crude oil supply, and markets are preparing for significant disruptions due to the sanctions and the possibility of reprisal by the Kremlin. On Wednesday, the global benchmark reached $115 a barrel, only a few days after breaking over the critical $100 threshold for the first time in nearly three years.
If you take a step back and look at the big picture, oil is already worth more than $100 a barrel, and if it remains there or rises any more, the price of jet fuel would soar to dizzying heights, according to Bowerman, a Malaysia-based expert. After low demand, such as COVID, airlines often operate more flights and cut tickets to gain market share. However, due to the rising cost of aircraft fuel, discounting will become untenable.”

According to Bowerman, airlines may have difficulty obtaining an adequate gasoline supply.
According to him, “long-distance airlines will be scurrying merely to discover it.” “This has the potential to reduce worldwide demand for air travel significantly,” says the author.
In addition to retaliatory sanctions by Russia, the barring of Russian flights from the airspace above the United States, European Union, United Kingdom, and Canada has placed an additional damper on the recovery.
The flying path through Russia, the world’s biggest nation and a vital link between Europe and Asia, will add several hours to the total trip duration on specific itineraries. According to John Gradek, a specialist in aviation management at McGill University, just one additional hour of travel time may add between $11,000 and $20,000 to the cost of a trip.

Most severely impacted will be flights between Europe and East Asia, at least in the short run. Flights to popular locations like Tokyo, Seoul, Shanghai, and London have already been canceled or redirected by airlines like Finnair and Japan Airlines (JAL). For Southeast Asia, which relies on tourism, the prohibitions represent yet another speed hump on the path to recovery.
According to Barnett, a consultant based in Phuket, “people are not going to say we won’t go outside because there is a war going on in Europe,” he said.
“However, we have not yet seen the full financial ramifications of the battle on oil prices and inflation,” the author writes. If the European market declines and China does not recover, it will hurt an already volatile market.”

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