Hotel industry in Colombia paralyzed

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Hotel industry in Colombia paralyzed
Gustavo Adolfo Toro Velásquez, Cotelco
Mon March 23, 2020

The expansion of the Covid-19 and the measures for its containment have generated a paralysis of the tourist and hotel activity, to the point of the temporary closure of establishments


According to the figures that Cotelco compiles, the country's hotel occupancy is at the lowest level in all of Colombia's history. So far this week, this indicator stood at 21%, a figure that suggests the imminent paralysis of the hotel industry. All reservations and events for the coming months have been canceled.

In the period March 8 to 19, 2020, the losses already add up to 430,000 million pesos and according to the estimates of the Center for Tourism Thought of Colombia, more than 150,000 direct jobs in the hotel sector are at risk throughout the country.

For Gustavo Adolfo Toro, executive president of Cotelco, “this is the biggest crisis that the hotel industry has experienced in Colombia, an unprecedented fact. Such is the impact, that many hotels have decided to suspend their operations and carry out the temporary closure, waiting for the crisis to be overcome. Hotel services have two characteristics that make it highly vulnerable: unsold rooms cannot be stored for later sale and secondly, there are high fixed costs; these two facts make the economic impacts very high. ”

“For now, the most important thing is to support the measures that come from the authorities, surround the decisions of the President, the Governors and the Mayors and avoid the collapse of the health system. Once this situation has been overcome, we will lead initiatives with the National Government that will reactivate tourism in Colombia and stimulate the hotel sector, a source of jobs and development opportunities for the regions. ”Says Gustavo Toro.

At the regional level, the greatest impacts are recorded in the capital cities, where so far this week (Monday 16 to Thursday 19), the occupation has reached average levels of 12% and there have been multiple closings.

In Bogotá, losses between March 8 and 19 amount to 42,000 million pesos, as a result of a decrease of 22 percentage points in hotel occupancy; while in terms of events developed in hotels, both business and social, about 200 of great impact have been canceled, with losses estimated at 5,000 million pesos.
In the city of Cartagena de Indias, the second with the greatest impact, hotel occupancy has fallen by 17 percentage points and losses are estimated at 40.7 billion pesos as a result of lower occupancy and about another 3.5 billion due to event cancellations.
Other destinations with significant economic impacts due to the exceptional situation that is experienced are

Antioquia, which has accumulated losses of 41,900 million pesos; Atlántico, with 26.8 billion less revenue in the hotel sector and Quindío with 27.7 billion less in losses.

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