|The protests started in Chile's capital, Santiago, as a student-led demonstration against the metro or transport fares. / Photo by: abriendomundo via Shutterstock|
The tourism industry of Chile is already feeling the pinch of violent unrest in the capital that began last month. After Chile pulled out hosting two of its major summits, many tourists canceled trips and hotel reservations in the country were also down by 50 percent, reports Economic Times.
The 2019 Chilean Protests
The protests started in the country’s capital, Santiago, as a student-led demonstration against the metro or transport fares. Early October, the government announced that the transportation rush hour prices will be increased by 30 Chilean pesos ($0.04). This incited a public outcry, so then-Minister of Economy, Development, and Reconstruction Juan Andres Fontaine said that those who were upset with the price increase should just wake up earlier so they would only pay at a lower rate. After his remarks, outrage grew and students conducted a mass fare evasion. Thousands of university and school students jumped barriers of the metro stations while others destroyed the said barriers. They chanted, “Evade, and not pay, is another way of fighting.”
But the anger went beyond the transport cost. This also prompted the frustrations of other Chileans with the increasing cost of living, low pensions and wages, poor public health system, lack of education rights, and inequality in the country. Even a professor at the University of Chile Jose Miguel Ahumada, who is also a political economist, said via TV channel Al Jazeera that Chile is one of the most unequal countries in Latin America.
Economic Unrest, Decades in the Making
Now, the protests in the country still show no sign of ending and people are calling their president to resign. Others blame the country's policies that started in 1990 as they adopt democracy. They likewise demand a new constitution.
A Threat to the Tourism Industry
As protests rock Santiago, they have also threatened the country’s tourism industry. Looting, arson, and riots have left at least 18 people in the country dead. Hotels are also empty. Santiago-based Principado hotel chain’s manager Ivan Marambio said via Economic Times that they “won’t be able to endure much more” of the unrest as their losses are now “enormous.”
The country’s sub secretary of tourism Monica Zalaquett pointed out how the tourism industry is “very sensitive,” the reason why reservations in the country have already dropped by 50 percent in the last two weeks alone. What is tougher for the tourism industry is that they cannot expect new reservations and should wait until the situation in Chile will stabilize.
While the streets have somewhat calmed during the long weekend, the impact of unrest has also spread to tourism-related businesses.
|Looting, arson, and riots have left at least 18 people in the country dead. / Photo by: erlucho via Shutterstock|
“Eat the Rich” Graffiti in Santiago Hotel
Philip Sanders, writing for Bloomberg, has also shared how a graffiti, which reads “Eat the Rich” in English spells “tough times” for the country’s tourism. The author has observed the graffiti written in large letters on the wall of the Cumbres hotel in Santiago. Eat the Rich is a saying that means, “When the people shall have nothing more to eat, they will eat the rich.”
Just like other hotels in the capital, Cumbres has been trying to provide a normal service to their clients despite the unrest. Upmarket tour company Sense Chile’s owner Gary James also said that every booking he had for October has already been canceled and he doesn’t hold much hope either for November. James believes that the impact of protests in his business will not end “anytime soon.”
Tour Groups and Hotel Bookings Canceled
The Federation of Tourism Companies of Chile, which is a union body that brings together professional groups and individual members of tourism companies, shares that tour groups and hotels have already seen 40 percent canceled reservations for summer and spring. The Federation’s executive vice president Helen Kouyoumdjian said that in all her years in the tourism industry, she has never witnessed such a slump. She also admits that the Federation doesn’t even know the next thing that will happen in the industry.
Hotels Attacked, Ransacked
One hotel in Santiago, Principado de Asturias, was also recently attacked. Its windows were smashed and the lobby was destroyed. Guests have no choice but to flee early. The Mercure hotel was also ransacked and was destroyed by fire. A recent study conducted by the Santiago Chamber of Commerce revealed that tourism spending using debit and credit cards decreased by 36 percent between October 18 and 27 alone.
The US Department of Commerce Bureau of Economic Analysis has shared that the tourism and travel industry is measured by the real output of goods and services sold directly to visitors. In the US, for instance, traveler accommodations contributed 4.7 percent to the total annual growth in real tourism output in 2017, its most recent data available. Food and beverage services were at -1.2 percent, transportation 0.6 percent, passenger air transportation 3.1 percent, and recreation, entertainment, and shopping 2.7 percent.
Meanwhile, Chile’s tourism statistics according to economic indicators platform Trading Economics shows that tourist arrivals in Chile decreased to 263,280 in June from 270,022 visitors in May this year. The average tourist arrivals in the country are at 184,903.43.
In times of political uncertainty, public violence, and social unrest, the tourism and travel industry is often hit because tourists cancel their usual vacation plans. This only goes to show how unrest in one country comes with a hefty price tag for its economy although such costs are hardly mentioned.