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Document Analysis: Pandemic Disrupts Italian Tourism

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Any Pandemic or outbreak has a social, political and economic impact which put any nation into a difficult state. Pandemics like COVID-19 is a challenge to the modern world with no vaccination and with a very limited capacity of medical treatment. An overview of pandemic's effect on the tourism-based economy is discussed below. When 90% of the world population face travel ban globally, then even globally most popular tourist places start to face an economic downturn. Laying off employees, going bankrupt or failing to return booking payments become a common issue. Ultimately, Airlines, Hotels and cruises are having devasting financial performance during this outbreak. Social distancing and mobility restriction make any sort of countermeasure to improve the situation useless for the tourism industry. The papers show how pandemic changes the performance and situation of the tourism industry in Italy. 2 | P a g e Mohammad Rasel S0570595
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Document Analysis:
Pandemic Disrupts Italian Tourism
Submitted to Prof. Dr. Tine Lehmann
MOHAMMAD RASEL
S0570595
QUALITATIVE APPROACHES TO MANAGEMENT
MASTERS IN INTERNATIONAL BUSINESS
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Mohammad Rasel S0570595
Abstract
Any Pandemic or outbreak has a social, political and economic impact which put any
nation into a difficult state. Pandemics like COVID-19 is a challenge to the modern
world with no vaccination and with
a very limited capacity of medical treatment. An overview of pandemic’s effect on the
tourism-based economy is discussed below. When 90% of the world population face
travel ban globally, then even globally most popular tourist places start to face an
economic downturn. Laying off employees, going bankrupt or failing to return booking
payments become a common issue. Ultimately, Airlines, Hotels and cruises are having
devasting financial performance during this outbreak. Social distancing and mobility
restriction make any sort of countermeasure to improve the situation useless for the
tourism industry. The papers show how pandemic changes the performance and
situation of the tourism industry in Italy.
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Mohammad Rasel S0570595
Contents
Abstract............................................................................................................................................ 1
1.Introduction .................................................................................................................................. 3
2.Pandemic ..................................................................................................................................... 3
3.Research Question ...................................................................................................................... 4
3.1 The purpose of the study ..................................................................................................... 4
3.2 Research Methodology ........................................................................................................ 4
4.Population Size ............................................................................................................................ 5
5.Sample Size ................................................................................................................................. 5
6. Literature Review........................................................................................................................ 6
6.1 Important Facts about Pandemics & Tourism .................................................................... 6
7.Impacts of Covid-19 on Italian Tourism ..................................................................................... 7
Figure:1 Inbound arrivals data by Euromonitor international. ............................................. 7
Figure:2 inbound receipts. ...................................................................................................... 8
7.1 Major attractions & Revenue for Italy.................................................................................. 8
Figure:3 Attractions visited by international tourist in Italy .................................................. 9
7.2 Change in Italian Hotel Occupancy..................................................................................... 9
8. MAXQDA Analysis ..................................................................................................................... 9
9.Results of MAXQDA Analysis .................................................................................................. 13
10.Conclusion ............................................................................................................................... 14
11.Reference ................................................................................................................................. 14
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1.Introduction
The global economy has experienced different sort of crisis from time to time.
Especially, the tourism industry took the heat from 2000 to 2020 so many times. Such
as the SARS outbreak in 2003, the global economic crisis on 2008-2009, MERS in
2015, and finally Covid-19 in 2020. Any pandemics disrupt first the balance of the
tourism industry. There are so many earlier warnings that pandemic brings a major
threat to society and tourism. (Gossling,2002). Moreover, the connection between
pandemics and tourism are the most important elements to a deeper understanding
of health safety and global transformation. (Burkle, 2006).
There are so many reasons for higher pandemic threats in the twenty-first century and
they are continuous growth, global population mobility, the higher concentration of
population on certain cities, recent urbanization trends, a greater consumption of
processed and fast food through delivery and advancement in the global transportation
system. (Pongsiri et al,2009). Higher contact rate among human, live stocks and
wildlife is the point where most infectious disease like Ebola, Hantavirus, Zika virus
Avian influenza are born. (Wu et al 2017, p.18).
Four major pandemics in the 21st century (SARS in 2003, Bird flu in 2009, MERS in
2015, Ebola in 2013-2014) has caused millions to the global economy. (Coker et al
2011, Greger,2007, Wu al 2017). SARS caused a financial loss of US$ 100 billion
globally and out of that $48 billion in China alone. (McKercher & Chon,2004; Siu &
Wong, 2004).
Because of swine flu, the Mexican tourism industry lost one million tourists over five
months which is almost US $2.8 billion loss. (Russy &smith,2013). Any epidemics can
widely spread by travelling and tourism both as well as it carries huge disruption for
the economy. (Nicolaides et al 2009)
2.Pandemic
Various experts defined pandemics in various ways. But all of them has a few
common aspects which widely matches.
They have a global extension & sometimes only in a specific geographical
location.
The transmission is so fast and it can be traced to point of origin.
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Aggressive rate of infection (High number of cases within a short time.)
A low number of immunities in the global population.
The pathogens are related to novel variants of organisms
3.Research Question
The research question I have developed for this study is -
How pandemic is disrupting the Italian tourism industry?
This research question aims to find out how Italian tourism industry facing economic
losses because of the travel ban and social distancing, what are the future economic
threats of this situation and how likely the nation will recover after this situation. And
is there any role of government to save the tourism industry when it’s economy largely
depends on it.
3.1 The purpose of the study
The purpose of this study is to find out how badly the current pandemic is hampering
the economy as a whole. The economy is highly depended on its tourism industry. So
how this global travel ban is causing massive financial losses for Italian airlines, hotel,
restaurants, travel agencies & museums is one of the major parts of this paper. And
how likely that the people who are involved in this sector will be at a loss and financial
distress. Moreover, how this will change their living standards. The paper throughout
focuses on the estimated financial losses for both individual and the whole industry.
Also, this paper tries to focus on how likely it will be able to recover from this situation.
Additionally, what experts suggest that the government should do to revive the
economy and save the tourism industry and what so far, the government has done to
resolve this situation. In a word, the purpose of this study is to have a clear
understanding of the current disruptions and future threats for the Italian tourism
industry and also how it can save it this difficult situation.
3.2 Research Methodology
Out of different form of research methods, I have selected documents analysis for this
study. Several forms of unsolicited documents have been used in this purpose of this
study. Documents can be found in several forms such as contracts, case studies,
statistics or even expert opinions. (Flick,2009). Document analysis is mostly based on
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secondary data. So, for this study, I have looked for secondary data and I have used
it for this research purpose.
In a word, document analysis is a standardized approach to study and measure
historical and recent evidence in the form of printed or electronic materials. There are
so many sources for documents available it could be research papers, videos,
published interviews, online blogs, books and social media post and pages.
4.Population Size
The population size for my study is the Italian tourism industry consists of hotels,
restaurants & all forms of travelling. The population size for data is all the previous
studies, published journals, news, online blogs, videos, published interviews, tourist
survey and reviews related to the Italian tourism industry.
So basically, the population size includes all these documents because these
documents provide a clear understanding about how people and government react
during travel ban & social distancing, & how this situation put all the organization and
people related to tourism into jeopardizing in Italy. Also, finding out the reaction of
experts and tourist going to Italy right after pandemics.
5.Sample Size
The population size is huge for this study that is why finding a sample size which will
serve my purpose is necessary. As there are lots of data available, to bring it down to
a smaller sample size. I have used the Purposeful Sampling Method”. Selecting
data/documents for study based on pre-specified criteria is how this method works.
This method helped me to select relevant documents to perform this study.
Sample Size - (Documents-10; Reports -5; News- 5)
Total documents 20
The pre-specific criteria for this study were how the pandemic is hampering regular
business, who are losing jobs and are in financial distress due to this situation, why it
is taking so much toll on tourism, what experts think of vital to save the industry, what
is the role government is playing in this.
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6. Literature Review
6.1 Important Facts about Pandemics & Tourism
1. Travel restrictions globally have put 90% of the world’s population into some
level of international travel restrictions, moreover some of the countries also
imposing internal movement restriction at a certain level. (Gossling et al,2020)
2. Anticipation by UNTWO that the number of international tourists will decline by
1% to 3% compared to those of 2019. (UNTWO 2020a)
3. Another estimation by UNTWO that it will bring a 20% to 30% loss in
international arrivals. (UNWTO 2020b)
4. More than half of the global flights have been cancelled as the global tourism
sloped to downward. (ECDC (2020), Flightradar24(2020))
5. New Zealand Airlines flying at 50% capacity to comply with social distancing
rule imposed by the government. (Air New Zealand, 2020)
6. Guest number in Italy dropped by 50% or more for most of the hotel and
accommodations. (STR, 2020a)
7. A report by the Norwegian tourism organization, most of the hotels, campsites,
car rental went through 41% registered cancellations. (NHO Reiseliv ,2020)
8. Around 65% of the tourism business reported that unable to pay rent. Moreover,
72% of the restaurants & 63% of hotels were facing liquidity issues. (NHO
Reiseliv ,2020)
9. Based on a Mckinsey report, 13.4 million jobs in the restaurant industry will be
lost and 3.6 million jobs related to food processing, and also 2.6 million jobs in
the food server will be affected. (McKinsey and Company,2020c)
10. “The pandemic shines a light on social welfare and job security in tourism”.
(Gossling et al, 2020)
11. IATA reported on 14th April 2020 that, air passenger revenue will become 55%
only as the global traffic fell by 48%. (IATA,2020)
12. The decline in International arrival will cause around US$ 300-450 billion loss.
(UNTWO, 2020b)
13. According to Italy's Confturismo tourism association "One hundred euros spent
on tourism generates 86 euros in other sectors,”. It shows how tourism
generates revenue for other sectors also. (Develioglu, 2020).
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7.Impacts of Covid-19 on Italian Tourism
Italy offers 55 UNESCO world heritage sites.12% to 13% of Italy’s GDP comes from
tourism. Most importantly 4.5 million of its population are involved in the tourism
industry. (Develioglu, 2020). Let alone in 2019, the country was visited by 216 million
tourists. (Develioglu, 2020). Several experts shared their estimates of the
consequences of COVID-19 on tourism. One thing is common in all the estimates and
that is a negative performance for the whole year. The most important thing is all of
these estimates should be treated very carefully. Massive job loss and global travel
restriction will change the shape of the Italian economy.
Being the fifth most popular travelling destination in all over the world, in 2020 Italy
was supposed to visited by 65 million tourists. Additionally, 65 million more domestic
trips were estimated to happen. (Bremner, 2020). From March 2020 to May 2020 the
country lost 30 million tourists alone. (Develioglu, 2020).
After initial lockdown and travel ban, most of the popular cities became a ghost town.
Based on Euromonitor international’s travel forecast model, it is anticipated that Italy
will lose 8 million inbound travellers in 2020. (Bremner, 2020)
Figure:1 Inbound arrivals data by Euromonitor international. (Bremner, 2020)
Only emergency and essential trips are continuing in Italy. To control the second wave
of infection, all the passengers were tested for the temperature at rail stations, airports.
All the international flights have been cancelled. During this period most the airlines
are offering a refund for cancellations and also offering Boucher to postpone the trip
to future date.US imposed travel from 13th march 2020 on the all-over European union.
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In 2019, there were 200,000 flights and 46 million passengers travelling between EU
And US. (IATA,2019)
The US plays the biggest role in inbound tourism of Italy. After Germany, the USA
holds the second position in inbound tourism receipts. So, this travel ban with the USA
will cost Italy millions. Small and medium scale business owners involved in the
tourism business will get hurt directly because of this travel ban with the USA.
Figure:2 inbound receipts. (Bremner, 2020)
Based on Euromonitor International’s Travel forecast model, inbound arrival will drop
by 11.2% from the anticipated baseline of 2020 due to Covid-19. The total estimated
loss of USD 5.7 billion receipts and 8 million arrivals loss will happen as per forecast
model. And the model also anticipated that it will take three years to recover from this
situation. Ultimately this income loss, the travel ban will put a deep scar on the Italian
economy as it is largely depended on tourism. (Bremner, 2020)
7.1 Major attractions & Revenue for Italy
Museums and historical places in Italy attract a huge number of tourists every year.
Most popular tourist spots have been closed due to COVID-19. Moreover, Museums
and art galleries which are either close or are running with limited opening hours.
Around 98 million international tourists visited at culture, heritage and museums sites
in 2019. (Bremner, 2020). They have generated around USD 14 billion revenue for
Italy though activities & shopping. (Bremner, 2020).
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Figure:3 Attractions visited by international tourist in Italy. (Bremner, 2020)
Only a few restaurants and chemists are open for emergency purpose. They also
serve a very limited number of customers due to social distancing regulations. Such
massive lockdown is hurting the economy severely. It will be really difficult to cover up
such a huge income loss for the Italian tourism industry.
7.2 Change in Italian Hotel Occupancy
It has been reported that around 32,965 hotels in Italy are empty. (Bremner, 2020)
Most of them are close and some of them running with 0% occupancy. That is why
they are in the brink of bankruptcy. Another report showed that 80% of the hotel and
restaurants will shut down temporally and seek financial aid from the Italian
government. (Bremner, 2020). Globally hotel and restaurant industry is facing the
threat of shutting down completely. Due to COVID-19 US hotel revenue per available
room will decline by 50.6%. (STR,2020b). So, this is not just who is facing this sort of
problem. Without the local government’s support, most of these hotels and restaurant
will fail to maintain cash flow in their business. If government allow them tax relief and
financial aid for this difficult time, the industry may survive easily. Otherwise, there is
no hope for them as it is expected that by the end of 2020 there will USD 200 billion
loss for the whole industry based on Confturismo report. (Develioglu, 2020).
8. MAXQDA Analysis
To analyze documents with MAXQDA, I have followed the thematic analysis with a
deductive approach. The Coding segments were designed to find out how popular is
Italy for tourism and how Pandemic like COVID-19 is disrupting the tourism industry
when it largely depended on it.
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To perform document analysis on MAXQDA efficiently these codes were created.
Details and meaning of each code are discussed below.
1.Popular Tourist Spot:
Worldwide Italy is the 5th most popular tourist destination. Around 130 million tourists
about to visit different cities in Italy. (Bremner, 2020). Especially, Italian museums, art
galleries, cafes are the biggest attractions. Destinations like Venice and Cinque Terre
suffer from overcrowding issue with tourist. Vince carnival one of the biggest events
which attract 3 million tourists and gross around 3 billion euros to the local economy.
(GHIGLIONE, 2020). But this week-long carnival was cancelled after 3rd day. Mass
tourism helps to spread infections virus-like COVID-19 easily. Being the most visited
place on earth, Italy became the most infected place with COVID-19 in Europe.
2.Lockdown:
The Italian government took a long time to react to Covid-19 situation. After a severe
outbreak in cities like Milan and Venice, the Italian government has put the whole
country in lockdown. Within a very short time, all the busy streets and tourists
attractions became empty. US, UK and lots of other European countries cancelled
travelling to Italy. The major city attractions such as museums, ski resorts have been
closed to stop spreading the virus. After Lockdown, the Italian prime minister said “the
worst crisis since second world war”. Italy is the first country in Europe to take such a
big hit after china. The lockdown situation is badly hurting “Made in Italy’ fashion
products too. (Develioglu, 2020).
3.Travel Ban:
From the beginning of March, most of the countries imposed a travel ban on Italy and
cancelled all the non-essential travelling. US travel ban is taking a great toll on Italy.
Even the European travel ban on Italy put lots of airlines into financial distress. As Italy
has a regularly high number of flights from Germany, Austria etc. Covid-19 made Italy
a no-go zone.
4.Decline in Tourist Number:
The number is tourist has reduced after the lockdown situation. Even after the recovery
situation, experts believe that it will take three years to get back to the old situation.
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And Italy may not become a mass tourist destination like before. Based on
Euromonitor’s travel forecast model inbound arrival by the foreign tourist will drop by
eight million from the estimated numbers. (Bremner, 2020).
5.Flight/Booking Cancellation:
Most of the airlines are in the brink of bankruptcy. If the government do not bail out
from this situation most of them will stop the operation permanently. Cancellation of
tickets by customers or because of travel of ban has put airlines, cruises, hotels into a
horrible situation. In 2020, the revenue passenger kilometres (RPK) will 38% lower
than that of 2019. (IATA,2020). As most of the flight is being cancelled there is already
a fall in revenue. Most of the airlines have only three months liquidity to run regular
business, so with this travel ban, they will not survive. (IATA,2020).
6.Booking Refund Issue:
Most of the pre-booked hotels are facing the issue of returning the advance
payments/booking amount. Due to Social distancing and travel ban regulation, they
are close and bound to pay back the customers. Most of the cases they are not offering
cash refund to the customers. They are giving the option to change the travelling date.
Because most of the hotels are unable to pay back the bookings in this economic
crisis.
7.Financial Crisis for Business & Economy:
It is the beginning of a new economic crisis. This crisis is not only hurting hundreds and
thousands of SMEs but also local government. Within 3-month Italy lost 30 million tourists. It
is expected that by the end of the year the total economy faces 200 billion loss. (Develioglu,
2020). The Tuscan city generated US$ 52 million each year from hotel and Airbnb but this
year it is unable to generate any tax revenue through tourism as there are zero occupancies
by hotels. Now the city itself facing problems with paying its bills. (GHIGLIONE, 2020). And
this crisis is not going to over soon. Even if the hoteliers open their business, there is no
guarantee that it will be full of tourist like before this year at least. (The Local, 2020)
8.Limited Service:
Restaurants and cafes are offering limited services and mostly take away by
complying with social distancing rules. Fewer seats in flight, trains are being offered.
Most of the cases running at half capacity. Some hotel kept their door open and hiked
their room price to cover up their expenses.
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9.Low Hotel Occupancy Rate:
More than thirty thousand hotels are experiencing zero per cent occupancy. And most
of them might close down. (Bremner, 2020). Moreover, most of the Airbnb host in
Rome & Milan rent a house and put it into the Airbnb listing. Now all Airbnb hosts are
losing money every day. As their room is empty for the last three months. They are
not sure how long they can continue like this. (The Local, 2020)
10.Unemployment & Hardships
A fifth of the entire official workforce of Italy is involved in the tourism industry which
approximately 4.2 million people. (The Local, 2020). Most of them are unemployed
and facing financial hardships. As they have no longer jobs, the bank will no longer
give them a loan. Because of the corona, more than 20000 property sale in Italy was
cancelled. Even real estate agents are facing the issue of unemployment. Venice’s
economy is fully depended on tourism. For the first time, the city is empty and no
tourist. Due to this lockdown, more than 20,000 people lost their job in Venice.
(GHIGLIONE, 2020).
11.Bankruptcy & Takeovers
Most of the small business owners are failing to pay their bills during this crisis. Some
business is about to go bankrupt as they don’t have enough cash to pay their rents
and pay back the refunds amount. In this situation, mafia will take the benefit by
offering loan at a higher rate and they can invest in hotels, restaurant and transport
companies who are facing a crisis. Moreover, there is a chance of taking over of Italian
companies by foreign rival companies. Then Italy will lose all the earning from Italian
brands. A new law has been passed by Conte’s government to forfeit this situation.
(The Local, 2020).
12.Government’s Aid & Recovery Plan
To support people who are involved with tourism has planned an incentive program.
And all the payments and taxes has been postponed for later. Each person is getting
600 euro for monthly expenses. But most of the people argue this not enough for them
to support. (The Local, 2020). Some of the companies will not survive without the
government’s support in this crisis. If the Italian government introduce a financial
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recovery plan like the German government and provide low-interest loan then lots of
business will able to survive.
9.Results of MAXQDA Analysis
Based on the all the document, Blogs, & News into consideration and applying all the
codes in MAXQDA we find the following results from code relations browser.
Figure: 4 Results on MAXQDA Analysis (MAXQDA 2020)
Figure: 5 Relations browser MAXQDA Analysis (MAXQDA 2020)
Based on the result of the analysis from MAXQDA, we can categorize the most
important factors that disrupt the Italian tourism industry during Pandemic like Covid19
and they are
1.Global travel ban with an extreme lockdown in major cities,
2.The huge number of flight and booking cancellation with uncertain refund issue,
3.Loss in major Income source due to no tourist & high number of Unemployment,
4.Delay in proper financial aid from the government to protect the tourism industry,
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10.Conclusion
Pandemics like covid19 makes us realize how vulnerable we are in terms of the health
care system and protection against such a situation to save the industry. Any infections
disease will spread faster when there is mass tourism in a country. Higher dependency
on tourism might be dangerous also for any economy. Italian economy will recover
from this situation but it will take longer than expected. Recovery plan by the
government would solve the issue faster. Without government aid, some companies
may go out of business.
11.Reference
1. Air New Zealand. (2020). COVID-19 FAQs., Available
at< https://www.airnewzealand.co.nz/covid19-faqs> [Retrieved April 6, 2020]
2. Burkle, F. M. Jr, (2006). Globalization and disasters: Issues of public health, state capacity
and political action. Journal of International Affairs, 59(2), 231265.
3. Bremner, C., 2020. Italy In Crisis as Tourism Demand Collapses Amid Coronavirus
Pandemic. [online] https://blog.euromonitor.com. Available at:
<https://blog.euromonitor.com/italy-in-crisis-as-tourism-demand-collapses-amid-coronavirus-
pandemic/> [Accessed 23 June 2020].
4. Coker, R. J., Hunter, B. M., Rudge, J. W., Liverani, M., & Hanvoravongchai, P. (2011).
Emerging infectious diseases in southeast Asia: regional challenges to control. The
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5. European Centre for Disease Prevention and Control (ECDC). (2020). COVID-19 Situation
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6. FlightRadar24. (2020). Total number of flights tracked by Flightradar24, per day, last 90
days. https://www.flightradar24.com/data/statistics
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[online] Wanted in Rome. Available at: <https://www.wantedinrome.com/news/effects-of-the-
coronavirus-pandemic-on-italys-tourism-industry.html> [Accessed 24 June 2020].
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10. Gössling, S. (2002). Global environmental consequences of tourism. Global Environmental
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M. (2020). Restaurant tipping in Europe. A comparative assessment. Current Issues in
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12. Gössling, S., Scott, D. and Hall, C., 2020. Pandemics, tourism and global change: a rapid
assessment of COVID-19. Journal of Sustainable Tourism, pp.1-20.
13. GHIGLIONE, G., 2020. Without Tourism, Italy’S Economy Faces Disaster. [online]
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14. Hall, C., Scott, D. and Gössling, S., 2020. Pandemics, transformations and tourism: be careful
what you wish for. Tourism Geographies, pp.1-22.
15. IATA Economics. (2020, March 24). COVID-19 updated impact
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16. The Local, A., 2020. Will Italy's Tourism Businesses Ever Fully Recover from The
Coronavirus Shutdown? [online] https://www.thelocal.it. Available at:
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coronavirus-shutdown> [Accessed 26 June 2020].
17. McKercher, B., & Chon, K. (2004). The over-reaction to SARS and the collapse of Asian
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at<https://www.mckinsey.com/industries/public-sector/our-insights/lives-and-livelihoods-
assessing-the-near-term-impact-of-covid-19-on-us-workers?>[ April 6, 2020]
19. Nicolaides, C., Avraam, D., CuetoFelgueroso, L., González, M. C., & Juanes, R. (2019).
Handhygiene mitigation strategies against global disease spreading through the air
transportation network. Risk Analysis, 40(4): 723740. Crossref
20. NHO Reiseliv. (2020). Korona-Analyse for reiselivet., Avaialble
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21. Pongsiri, M. J., Roman, J., Ezenwa, V. O., Goldberg, T. L., Koren, H. S., Newbold, S. C.,
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disease ecology. BioScience, 59(11), 945954.
22. UNWTO. (2020a). COVID-19: UNWTO calls on tourism to be part of recovery
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plans.
23. UNWTO. (2020b). International tourist arrivals could fall by 20-30% in 2020. 2020, Available
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24. Russy, D. & Smith, R. (2013) The economic impact of H1N1 on Mexico’s tourist and pork
sectors. Health Economics, 22(7), 824834. doi: Crossref
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Economic Papers, 3(1), 6283. Crossref
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blog/coronavirus-hotel-industry-data-news> [Retrieved April 5, 2020]
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27. Wu, T., Perrings, C., Kinzig, A., Collins, J. P., Minteer, B. A., & Daszak, P. (2017). Economic
growth, urbanization, globalization, and the risks of emerging infectious diseases in China: a
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... The COVID-19 pandemic crisis has severely affected the entire economy, but the tourism sector has been -and will continue to be -particularly affected. Any pandemic crisis has a social, political and economic impact which put any nation into a difficult state and brings huge challenges to the modern world (Rasel, 2020). ...
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This is the third edition of the essential introductory text for all students of qualitative research. Each chapter has been fully updated in terms of references and reading lists.
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