"Tourism and Aviation Industries See Sales Halved... Government Support Needed Including Comprehensive Real Estate Tax Reduction"

'The 22nd Tourism Industry Committee' Held
Travel Industry Down 92%, Aviation Down 64%

[Asia Economy Reporter Dongwoo Lee] As the domestic tourism and aviation industries have suffered enormous damage due to the COVID-19 pandemic, business leaders and political figures gathered in one place to discuss industry recovery.

The Korea Chamber of Commerce and Industry (KCCI) Tourism Industry Committee held the "22nd Tourism Industry Committee Meeting" on the 20th at Lotte Hotel in Sogong-dong to discuss response measures to the COVID-19 crisis. The committee usually meets twice a year, in the first and second halves, but this year it was held after a year, following the second half of last year, due to the spread of COVID-19.

Woo Ki-hong, Chairman of the KCCI Tourism Industry Committee and President of Korean Air, said in his opening remarks, "The tourism industry, including airlines, hotels, travel agencies, and conventions, has suffered more direct and severe damage than any other sector due to the unexpected COVID-19 pandemic," adding, "We hope the government and the National Assembly will pay urgent attention and provide maximum support to help the tourism industry, which holds a significant share in our country's industrial ecosystem, recover and protect its workers."

Do Jong-hwan, Chairman of the National Assembly's Culture, Sports and Tourism Committee, said, "I hope today's meeting will lead to productive discussions to prepare tangible measures based on the vivid voices from the tourism industry field."

According to sales trends of major tourism businesses from January to September this year, surveyed by the Korea Culture and Tourism Institute and the Korea Air Transport Association, the travel industry’s sales dropped by 92.8% compared to the same period last year, effectively halting normal business operations. International conferences (down 67.4%), aviation (down 64.0%), amusement facilities (down 45.7%), and lodging (down 40.4%) also suffered severe damage.

Jeon Hyo-jae, Head of the Tourism Industry Research Division at the Korea Culture and Tourism Institute, who presented at the meeting, analyzed, "The domestic tourism industry had been continuously growing quantitatively in terms of the number of workers and sales, but due to COVID-19, tourism business sales from January to September this year fell by 58.0% compared to the same period last year."

Kim Kwang-ok, Director of the Korea Air Transport Association, who presented on the aviation sector, diagnosed, "International passenger flights have continued to decrease by 97% compared to last year, effectively keeping the industry in a shutdown state. Domestic passenger flights initially plummeted by up to 56% compared to last year during the early spread but have recently shown some recovery."

However, he added, "The share of domestic passengers remains low, limiting the recovery of passenger revenue. The association estimates that this year's sales will decrease by 68% compared to last year, and it expects the recovery of air travel demand to take at least two years and up to five years, indicating a bleak outlook."

The industry proposed measures to overcome the downturn, including allowing duty-free shopping on sightseeing flights, temporarily reducing comprehensive real estate tax for luxury hotels, and introducing pandemic-free passports.

The hotel industry requested temporary reductions in property tax and comprehensive real estate tax. Yoo Yong-jong, Chairman of the Korea Hotel Association, said, "Most luxury hotels in Korea are located in conveniently accessible urban areas, so they bear a heavier property tax burden due to rising official land prices compared to other industries. Given the sharp decline in visitors due to COVID-19, it is necessary to implement temporary reductions in comprehensive real estate tax."

The exhibition industry requested support for hiring professionals for non-face-to-face meetings, and the aviation industry proposed measures to restore air travel demand by improving entry and exit procedures. Kim Soo-gon, Executive Vice President of the Korea Air Transport Association, stated, "There is a need to accelerate the introduction of pandemic-free passports and digital immunity passports, which are being reviewed internationally."

Attending the meeting were Chairman Do Jong-hwan, Choi Yoon-hee, 2nd Vice Minister of the Ministry of Culture, Sports and Tourism, Kim Sang-do, Director of Aviation Policy at the Ministry of Land, Infrastructure and Transport, and Chairman Woo Ki-hong. Industry representatives included Kim Jin-guk, CEO of Hana Tour; Han Chae-yang, CEO of Shilla Stay; Kim Hyun-sik, CEO of Hotel Lotte; Jung Geum-yong, CEO of Samsung C&T; Kim Jeong-su, CEO of Hanjin Travel; Yoon Young-ho, Chairman of the Korea Tourism Association; Oh Chang-hee, Chairman of the Korea Association of Travel Agents; Yoo Yong-jong, Chairman of the Korea Hotel Association; and about 20 other corporate and organization leaders.

Kang Seok-gu, Head of the Industrial Policy Team at KCCI, said, "Along with financial support to maintain the weakened industry's basic strength after prolonged exposure to the crisis, policy reviews should also be conducted to seize business opportunities once the COVID-19 pandemic situation ends."

This content was produced with the assistance of AI translation services.