Angry with U.K., Spain Faces Further Loss of German Tourism

Prime Minister Pedro Sanchez, who responded angrily to the U.K. ratcheting up its travel ban to Spain to include popular holiday islands, now faces the prospect of losing German tourists in the busiest summer month as well.

In an interview with local broadcaster Telecinco, the Spanish leader called the U.K. decision “unbalanced” and said there were more case of the virus in Britain than in the Balearic and Canary Islands. On Tuesday, the U.K. defended its decision not to distinguish between the different regions of Spain.

With its tourism-reliant economy on its knees, Spain is desperate to convince the U.K. to reconsider as stranded Britons, prospective travelers and airlines all complained.

To make matters worse, Germany on Tuesday recommended avoiding non-essential travel to the regions of Catalonia, Navarra and Aragon, citing concerns over higher coronavirus case numbers and local lockdowns. Germans are the main tourist group to Spain, behind Britons.

For Europe, the biggest question is whether it can save its summer for consumers and businesses alike. Countries like Spain and Italy not only suffered some of the highest deaths tolls from the virus but are paying the highest price economically. For governments, the need to keep people safe while trying to resume life as normal is a hard balancing act.

The moves followed a steady rise in new coronavirus infections in Spain last week and led other European countries, including France and Belgium, to begin advising against trips to some parts of Spain. It’s also created friction.

‘Internal Transfer’

“We respectfully disagree with the Spanish government,” Local Government Minister Simon Clarke told the BBC. “You do have to make decisions on a country-wide basis. There is going to be internal transfer within Spain.”

Prime Minister Boris Johnson has already ordered everyone returning home from Spain to be quarantined for 14 days and his top diplomat told Sky News on Sunday “we cannot make apologies for doing so.”

There are signs Johnson might be re-thinking aspects of its policy even as he warns the country must be “vigilant” about a resurgence of Covid-19.

Plans being examined by officials in London include abandoning the blanket rules applying to travel across whole countries in favor of regional restrictions, and reducing the number of days passengers arriving back home in Britain will need to stay in quarantine. The Telegraph newspaper reported the quarantine measures may be shaved to 10 days to save something of the holiday season.

The mixed signals will be damaging to tourism no matter what.

Green Light

The European Union is set to keep its external borders shut to many countries including the U.S and is leaning toward shortening a list of 13 states -- Canada, China, Japan and South Korea among them -- whose residents have the green light to visit the bloc, according to officials.

Before Monday’s announcement, the tourism industry had hoped the islands would be exempted from the U.K.’s quarantine requirement. Instead, the official advice was extended to include the popular summer destinations.

On Monday, James Slack, Johnson’s official spokesman, said travelers should be aware the advice could change for other destinations if they see a spike in coronavirus cases.

“No travel is risk-free and disruption is possible,” Slack told reporters on a conference call. “Anyone traveling abroad should be aware that our travel advice and exemption list are under constant review as we monitor the international situation.”

Key Market

That will be of little comfort to Spain. The U.K. is critical to its economy -- many of its pensioners have retired along the country’s Mediterranean coast, and British sun-seekers account for 20% of Spain’s overall visitors.

For Sanchez, the U.K.’s actions are not just disproportionate, they are flawed. He urged the U.K. to find the correct balance based on the data.

New infections in Spain rose last week to the highest since early May, but the government’s top epidemiologist explained the situation is very different now because the number of intensive care patients and deaths isn’t increasing, signaling that cases are being detected early on as medical testing has improved.

It’s further bad news for the airline industry stuck in an unprecedented crisis.

Leading U.K. airline operators continued to lose ground after Monday’s drops, with EasyJet Plc down 2.14% at 9:46 a.m. in London and British Airways owner IAG SA down 1.79%. Leading Spanish tourism-linked stocks managed to recoup some losses Tuesday, after plummeting Monday on the announcement, with leading vacation-resort operator Melia Hotels International SA up 2.6% and airport operator AENA SA was up 1.93%, after dropping 1.81%.

©2020 Bloomberg L.P.

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