The Moroccan Travel Management Club suggests governmental support for travel agencies to help them recover from the crisis.
Rabat – The Moroccan Travel Management Club (MTM Club) prepared a report outlining the socio-economic impact of the COVID-19 pandemic on the tourism industry. The report also includes a series of recommendations for travel agencies and the government to help the agencies get out of the crisis.
MTM Club, an association of the largest hospitality agencies in Morocco, joined in the collective effort of state and non-state actors to foster the economic recovery of Morocco.
“The 20 largest agencies in Morocco grouped in this club have decided to make their voices heard in a difficult economic and social context,” said Mohammed Setti, the general coordinator of the MTM Club, in a statement to Maghreb Arab Press (MAP).
MTM Club offers extensive recommendations on the revival of Moroccan tourism covering various aspects of the industry, such as promotion and marketing, internal tourism, digitalization, banking and finance, and insurance strategy for the industry.
“The effects of the pandemic make it obvious and necessary to help the sector not only maintain itself but also prepare for its recovery,” Setti told MAP.
MTM Club envisions regular debates on specific subjects regarding promotion and marketing. The first part of the MTM Club’s report also invites stakeholders to “rethink the promotion and marketing strategy of the Moroccan National Tourist Office (ONMT) in consultation with travel agencies,” a piece of advice aimed at both domestic and international tourism.
The report suggests the development of a long-term domestic tourism strategy of at least two years that will offer special deals to Moroccan citizens and residents if they commit to using services of Moroccan travel agencies.
The association recommends a review of the e-commerce policy and a collective agreement with the official bodies as well as the regional federation and associations to find adequate tools to support the digital progress.
The report includes an extensive analysis of the financial aspects of crisis mitigation. The association recommends weighting fiscal action, particularly reducing the rate of value-added tax (VAT), to offer relief to the travel agency sector. The “fully justified” measure adds to the already existing extensions on tax payments.
Strong support from both the state and the banking sector, visible in granting loans at reduced rates, is necessary for the revitalization of travel agencies’ investments, according to the report. Simultaneously, tax exemption for two fiscal years would boost the consolidation of small- and medium-sized travel enterprises.
The report suggests the suspension and amendment of Law 11-16, adopted in 2018, to consider the impacts of the post-pandemic reality, upon an appropriate study.
Law 11-16 is a reform of Law 31-96 on the status of travel agencies. The main reforms included a gradation of the two-level license system, an integration of online distribution and distance selling, the access to the profession for developers, measures to encourage domestic tourism, and harmonization with Moroccan laws affecting the activity of travel agents.
The law faced backlash from travel agencies in 2018.
The government should also subsidize the travel agencies, according to the report, especially stimulus programs in business-to-business (B2B) marketing for the main traditional markets. The state should provide budgets for sales campaigns that will cover “education trips for decision-makers and specific workshops, the report continued, in addition to a regional promotion campaign.”
Insurance for the future
Travel agencies’ insurances currently do not include natural risks or pandemics. The MTM Club calls for widening the coverage of such risks to protect the industry from future shocks.
The protection, according to the report, should go further into protecting Moroccan companies from “unfair” competition of foreign agencies. A means to achieve such protection would be to reactivate the clause that obliges foreign operators to follow Moroccan law for all tourist transactions in the country.
Morocco lost 100,000 tourists in March alone. One-fourth of Moroccans, 2.5 million, are employed in tourism. The industry generates 11% of Morocco’s GDP, or 15% including indirect contributions from transport or agriculture. The MTM Club highlights that apart from being a crucial economic sector, tourism also allows substantial amounts of foreign currency to flow into Morocco.
The United Nations World Tourism Agency (UNWTO) warned that the losses in international tourism may reach between approximately 60 and 80% in 2020. The agency increased its predictions trifold in a month—a report from March 24 forecast the loss at between 20 and 30% worldwide.