In the case of the conflict between Ukraine and Russia, ATA is attentive to the situation for a few weeks and adapts to recovery scenes for tourism as well as strategy if necessary. At this moment there is no indication of cancellation nor a reservation decrease for Aruba.
The figures till February and the projections for the rest of 2022 show that we can reach a degree of recovery of 90% in juxtaposition to 2019- if there’s no additional change. There’s no need to forget that Covid-19 plays a role as well, and ATA exercises caution and follow developments closely.
It is not a secret that Aruba is the first or second-most dependent country of tourism in the world. This makes that for ATA, is essential for monitoring each international crisis, which can affect our tourism directly or indirectly.
The uncertainty that a crisis initiates, can affect the demand for products and services, principally the one considered luxurious, like flights and vacations. This makes it that many times there’s a demand for capturing the product, an alternative destination that competes with offering more attractive prices to reduce losses. It is not healthy, looking at the businesses and for Aruba, it can be impacted, however, there can be demands, if Aruba also needs to reduce prices to capture demands.
The geographical distance between Aruba and the area of conflict is great, but the effects can be felt in different ways. The conflict here and other conflicts in the last decades has affected the economy of many countries, including our principal market which is the United States. The moment that there’s a type of crisis of this magnitude, it affects the buying power, looking that the product prices are increasing. One of the aspects that also have to be taken into account is the prices of flight tickets for planes, which can increase significantly considering the increased fuel prices. Consumers can also opt for saving, considering the uncertainty. In another way, the ones who planned their flights for Europe, which was closed for a long time, can decide to not go anymore and opt for being closer to home, and go for a flight within the Caribbean.
Additionally, it’s important to remark that for the Dominican Republic, Russia is the second-largest market, with a few hotels in Punta Cana, which depends on a large number of charters from Russia. They are focused more on Latin American and North American markets to minimize the losses and can expect some strategies and price reductions to recover the lost businesses.
At that moment, on the recommendation of associates in charge of exterior public relations, is adapting to international messages that are being used to position Aruba internationally. The tone is softer and with a grander focus on the initiatives of nature and welfare, focusing less on the aspects of parties.
As mentioned, we still don’t feel the effects of the crisis on tourism, but is still prudent to analyze different conflicts and international crises in the last 20 years, particularly the ones that are affected our principal market the United States. Based on this, while premature, maintaining a conservative scenario for 2022 and with a degree of recovery of 84% and more optimistically 90%, compared to 2019.
ATA will continue following the situation closely to properly react.
