Ramping up vaccination rates for Covid-19 will help boost the recovery in the travel and tourism industry, a panel of experts told CNBC.
Vaccination is the only comprehensive way to fight the impact of the coronavirus, Ritesh Agarwal, CEO and founder of Indian budget hotel chain start-up Oyo, told Nancy Hungerford during the virtual CNBC Evolve Global Summit on Wednesday.
Global travel and tourism took a massive hit last year and many airlines are still struggling to stay afloat. The coronavirus pandemic shut down borders and suspended most international travel. With vaccination rates picking up, especially in the West, many countries are slowly opening up their economies and borders.
“I believe travel is here to stay. Domestic travel will lead the recovery but vaccination is the only comprehensive and conclusive way of resolution,” Agarwal said.
Oyo, a SoftBank-backed start-up, saw its daily bookings for the summer season more than double in Europe where the vaccination rate is relatively high, according to the CEO.
Travelers tend to book rooms in hotels where the staff have been inoculated, he said, adding that Oyo provides certificates to show their staff have been vaccinated, Agarwal said.
Asia’s vaccination drive
Where vaccination rates are concerned, some of the more populous countries in Asia have comparatively fallen behind their counterparts in Europe and the United States.
Information collated by scientific online publication, Our World In Data, showed that as of June 15, 40% of North Americans have received at least one dose of Covid vaccine and 36% in Europe. In comparison, only 21% received at least one shot in Asia, though the pace of vaccination is picking up in the region.
AirAsia chief executive Tony Fernandes said he remains very optimistic about vaccination rates, especially in Southeast Asia.
“The distribution is there, the demand is there, and now supply is becoming consistent,” he said, adding that he expects most Southeast Asian countries to reach a vaccination rate of 60% for a first dose by September.
I believe travel is here to stay. Domestic travel will lead the recovery but vaccination is the only comprehensive and conclusive way of resolution.
CEO and founder, Oyo
But he is less upbeat about the possibility of an internationally recognized vaccine passport — a digital app on a smartphone that can access an individual’s health data to confirm if they have been vaccinated against Covid-19.
Support for digital health passports is split. Critics point to concerns over how secure a person’s data will be, as third-party apps will be communicating with databases containing sensitive personal health information.
What the travel industry needs, however, is consistency around regulation, according to the budget airline boss.
Passengers crowd at Wuhan Railway Station on the first day of the Dragon Boat Festival holiday on June 12, 2021 in Wuhan, Hubei Province of China.
Zhao Jun | Visual China Group | Getty Images
“If you have got two vaccines, you don’t need to quarantine. That seems to vary country to country,” he said. Nations should also accept all vaccines that have been approved by the World Health Organization, Fernandes added.
Major trends among travelers
Domestic travel is already picking up in countries like China that have brought the pandemic under relatively good control. Cases have remained comparatively low while the vaccination rate climbed.
Millions of people rushed to travel last month during a five-day Labor Day holiday in the country as bookings for hotels, car rentals and other travel soared.
Jane Sun, CEO of Chinese travel booking site Trip.com, said that she is looking forward to a strong rebound for domestic travel in China. “We have seen strong pent-up demand through the data of our search volume,” she said.
Sun explained there are three trends being observed among those who are traveling again since the start of the pandemic.
First, they are booking more with hotels, airlines and local operators who are providing masks, hand sanitizers and other safety measures. Second, people are now traveling in much smaller groups. Finally, they are choosing packages with flexibility, that allow them to change, cancel or postpone their trips.
AirAsia’s Fernandes agreed that the current situation required operators, including the low-cost carriers, to adapt and offer more flexibility to travelers — even if it may not be a sound business decision.
“There’s too much uncertainty,” he said, adding that the airline may bring back some of its older, more strict policies once there is more certainty in travel.