There was an interesting article this weekend in one of the online Costa Rica dailies. In the article, the president of Canatur (Costa Rica’s Chamber of Tourism), Rubén Acón expressed nervousness over the future of tourism, at least in the short-to-mid-term.
In the long-term, vaccinations will help make the pandemic disappear, and that’s likely to happen sooner than expected. They’re already rolling the first vaccines out in the UK this week, and the rest of the world isn’t far behind.
Before that though, Acón is worried on behalf of the many tourism businesses represented by Canatur.
Since Costa Rica reopened to tourism in August, visitor numbers have been small but growing. But even so, Acón reports a 92% decrease in tourism in October 2020 compared to the same month in 2019. In this December-April high season, he expects Costa Rica to receive 25% to 30% of the tourists who came last year.
That’s not enough visitors to save tourism in Costa Rica and Acón fears it might be too late for many businesses.
Pre-COVID, tourism represented some 8% of Costa Rica’s GDP and over 10% of its direct employment. If you count indirect or “unofficial” employment, some estimate tourism takes up at least 25% of jobs.
Since Costa Rica closed its borders in March, many of those jobs have disappeared. Restaurants, hotels, and tour companies have closed their doors. The trickle of tourists coming in now and over the coming months won’t bring these businesses and jobs back.
So what does Costa Rica need to do to save its tourism industry?
What does it need to do to open up those shuttered hotel and restaurant doors again and give hope to thousands of laid-off people?
The first thing the tourism sector needs is money.
According to Acón, Costa Rica’s government needs to set up a guarantee fund to help struggling businesses unable to access credit from the banks. Such a fund would go a long way to helping them ride out the rest of the pandemic until the situation improves.
Such a plan is in the pipeline right now, following an agreement between the government and the Central American Bank for Economic Integration (CABEI). Unfortunately, legislators have yet to approve this, and time is running out. This situation provides ammunition to critics who say the government doesn’t seem to care about reactivating the economy.
Casey Halloran, the CEO of the Costa Rica travel agency Costa Rican Vacations agrees with Acón on the importance of a guarantee fund.
“Tourism needs working capital, period,” he says. The entire industry lost over half a year of cash flow. It’s going to be extremely difficult to make up that gap with new sales.
“So, finding bridge capital to tide over the industry while arrivals return to near-normal is critical. Unfortunately, without some form of guarantees from the government, it doesn’t appear that private banks are willing to take that risk. For that reason, the industry needs some kind of fund outside of the banking system to help us keep our doors open and save jobs.”
Another obstacle appears to be Costa Rica’s lack of promotion as a destination.
In the past, Costa Rica always marketed itself well to attract tourists. Who can forget the “No Artificial Ingredients” campaign of the late nineties and early noughties? And then after that the simple “Essential Costa Rica” slogan.
But in these special times, outside of some rudimentary efforts and a push to promote domestic tourism, Costa Rica’s international marketing efforts have been minimal.
This is a worry to Meni Mikowski, owner of the Tabacon Resort in La Fortuna. He doesn’t see Costa Rica promoting itself enough abroad as a safe place to vacation during the pandemic.
“It takes promotional effort to sell Costa Rica as a destination. Nobody’s sitting in airports abroad waiting to come,” he says.
“Other countries like Belize, the Dominical Republic, and Mexico are promoting themselves while we’re not, and that’s a problem.”
Another obstacle in making tourists hesitant to visit Costa Rica is the travel insurance issue.
Costa Rica dropped all its COVID-19 test requirements at the end of October. Tourists no longer need to present the negative results of a COVID test as a requirement to enter. It’s the only country in Central America to take this approach.
Unfortunately, it’s not the testing that most would-be tourists find most onerous. It’s the insurance they’re mandated to take out.
Again, Costa Rica is the only country in the region to require special health insurance covering COVID for tourists. Oftentimes, the price of this insurance is prohibitive, especially for families and other groups.
“Faced with paying hundreds of dollars for this insurance or the option of going elsewhere, many travelers will go elsewhere,” says Justin DeBoom, the owner of Caribsea Sportfishing, a fishing charter company based in Quepos.
These are the principal obstacles to Costa Rican tourism that are in the hands of Costa Rica itself.
Costa Rica can certainly to more to help the sector economically, to market itself better, and to make it a more competitive destination for tourists by dropping the insurance requirement. All this could be done fast and would make a real difference.
But the biggest obstacle of all is something Costa Rica can’t change… the restrictions in other countries around the world.
More states in the United States requires returning travelers to take a COVID test and/or quarantine upon arrival. Canada requires quarantine for travelers returning home from Costa Rica, as do many European countries. Whatever Costa Rica does won’t change this, and this is why so few people are coming.
It’s not that they don’t want to travel to Costa Rica. It’s more that they’re not willing to quarantine themselves for two weeks after their vacation. This is the biggest issue of all.
And as much as it sucks to say it, there’s no way around this at all.
We have to be patient and ride it out until things improve. And they will improve very soon. There’s no doubt about that. We’ve got vaccines out there now, and more coming thick and fast. These foreign lockdowns will abate.
And then the Pura Vida will come back thick and fast. We just need to look after each other until that happens and push for the changes we can control.