Eoghan O’Mara Walsh: Nervous times for 20,000 tourism and hospitality businesses

Irish tourism is resilient but it will be tested every which way this year and that it is still standing is remarkable in many ways

Eoghan O’Mara Walsh is the CEO of The Irish Tourist Industry Confederation.

No sooner had a beleaguered Irish tourism and hospitality industry taken a breath as Covid-19 seemed to abate, then war erupted in Ukraine making projections for the year ahead even more difficult to predict for businesses throughout the country.

It has been some three years for Irish tourism since the 2019 peak: First the hardest of Brexits looked possible right up to the 11th hour, and then a pandemic swept the globe effectively closing travel, tourism and hospitality. Now, war rages on the European continent.

Irish tourism is famously resilient but it will be tested every which way this year.

The fact that Ireland’s tourism and hospitality industry – pre-pandemic the country’s largest indigenous industry and biggest regional employer – is still standing is remarkable in many ways. 

No other economic sector was closed or had its ability to trade curtailed for so long. It is estimated that Covid-19 restrictions cost the industry a staggering €12.2bn as international visitors – the mainstay of the Irish tourism economy – stayed at home. Constructive case-making and advocacy, allied with an engaged Tourism Minister in Catherine Martin, meant Government responded to industry’s needs. 

The wage subsidy scheme, business continuity grants, an aviation package to restore connectivity, and the waiver on local authority rates were all vital supports that enabled tourism businesses navigate a traumatic period. 

However all those supports are coming to an end and tourism firms must now stand on their own merits even though demand is still well shy of where it needs to be and the costs of running a business continue to soar.

Irish tourism had been looking forward to a strong bounce back but it is now clear that recovery will be a long and arduous road and Government must stay the course. 

These are nervous times for the 20,000 tourism and hospitality businesses in the country and they need to know that Government support remains steadfast. 

State investment in tourism needs to be maintained and the Vat hike that is scheduled to hit industry this autumn simply must be deferred until recovery has taken hold.

The Ukraine war is first and foremost a humanitarian crisis and it is only right and proper that Ireland is doing all it can to help the besieged country and its devastated refugees. The Irish tourism industry will play its part and can offer employment opportunities as well as hotel accommodation to refugees. However the State must have a balanced approach when it comes to securing accommodation for refugees. Hotels can only be part of the solution. Holiday homes, vacant dwellings and student accommodation, as well as hotels, need to be used for war-stricken families.

The Ukraine situation also has the real potential to spook international markets and, in this context, Irish tourism chiefs are watching the US closely. 

Stateside the war in Ukraine is being portrayed as a war in Europe and Americans’ sketchy sense of geography means that they may decide to defer a trip to Ireland until there is an end to hostilities. 

The momentum of bookings from North America has somewhat slowed and this is of concern. Irish tourism’s recovery is predicated on a strong US and Canadian bounce back. Encouragingly Aer Lingus, the dominant transatlantic carrier, has restored around 90% of its pre-pandemic capacity which means air access is in place, the key driver of tourism. Crucially those seats now need to be filled.

Tourism, like all of society, of course has another fundamental issue to address. Critically, and for the benefit of people and planet, the Irish tourism sector will need to address the environmental sustainability agenda that the planet faces. Achieving reductions in carbon whilst re-growing tourism will be extraordinarily challenging.

A new national tourism policy is due to be unveiled by the Government next year and sustainability will be at its core.

• Eoghan O’Mara Walsh is CEO of the Irish Tourism Industry Confederation

The Irish Tourism Industry Conference holds its tourism conference on April 27 in Croke Park, Dublin. The conference – A Sustainable Recovery in a Competitive World – is moderated by broadcaster Dearbhail McDonald and speakers include Minister Catherine Martin, economist David McWilliams, virologist Luke O’Neill, Aer Lingus CEO Lynne Embleton and IATA’s Willie Walsh amongst others. Tickets available here.