Isha Sesay
AS the coronavirus pandemic keeps billions of people at home across the world, the tourism sector in Mallorca is undergoing an immediate crisis with countless companies struggling to stay afloat.
Unions representing tourist establishments across the island have made the stark announcement that due to the COVID-19 crisis, a significant proportion may not be able to open their doors until 2021.
In fear of incurring heavy expenses that cannot be offset with the usual influx of tourists, there is now a growing consensus among the hospitality, commerce and nightlife industries to delay opening until Easter next year.
The President of the Mallorca Restaurant Association, Alfonso Robledo, said business owners are more concerned about the repercussions of reopening than the current nationwide lockdown which has forced their businesses to close.
“There is considerable fear that not enough tourists will come to the island and that the remainder of the season will be too short to compensate their outgoings,” Robledo said.
This includes the hiring of staff and supply costs – investments that Robledo says will incur losses which many businesses cannot afford.
He concluded that a closed restaurant implementing an ERTE, a temporary lay off of workers, hardly involves any expenses.
However, reopening without clients can generate more losses than benefits, and there is also a contractual obligation to keep staff on for six months.
The Association of Nightclubs in the Balearic Islands (ABONE) claimed the uncertainty of the pandemic has left establishments in limbo, and that many business owners have made the decision to reopen next year.
President Jesus Sanchez explained that nightclubs depend on high concentrations of people to be profitable and if restrictions continue to be put on large gatherings, the sector will be severely hit.
Moreover, even if restrictions are lifted, Sanchez believes many people will be reluctant to attend parties over fear of contagion.
He said: “Outdoor activities, such as going to the beach or having a drink on a terrace, are likely to be less affected than nightclubs, where the concentration of people is much higher.”
The President of the Federation of Business Employers in the Balearic Islands (AFEDECO), Toni Gaya, affirms that more and more businesses are communicating their intention not to open their doors until Easter 2021.
“A shortage of customers will give companies a turnover which is insufficient to cover the expenses that they will have to assume,” he said.
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Gaya explained that countries locking down their borders and people around the world staying at home to help stem the spread of the virus will negatively impact tourism in the islands.
“Visitors now have limited purchasing power and reductions in their income due to the crisis will influence their decision not to travel this year.
With events cancelled, non-essential travel restricted and holidaymakers having to self-isolate at home, hoteliers across the island have also found themselves in jeopardy.
Although most businesses are sitting tight, hoping everything will blow over, many have joined forces to demand that a series of measures are enforced by the government.
This includes the non-payment of taxes and municipal rates for the rest of the year, which they believe will help establishments reopen in the future.
In a statement from Isabel Vidal, the President of the Association of Hoteliers in Playa de Palma, she denounced officials failure to offset taxes despite the fact that all hotels are closed.
She said: “Since its creation, Playa de Palma has consistently contributed millions of euros to the government.
“However, the crisis generated by the COVID-19 pandemic has plunged the sector into its worst economic crisis, and the government are pushing us into an unprecedented collapse.”
“We cannot reopen if expenses continue to swallow us up.”
The government has not yet commented on the demands.
