Introduction
Effects of COVID-19
Comment



Introduction

Wakanda is a fictitious nation in the Marvel universe. Its leader decided to close its borders to protect it from foreign threats, eager to access the country to obtain its precious vibranium, a mineral enabling Wakanda to be among the leading technological nations in the world.

Peru, like many countries in Latin America and around the globe, has taken a similar approach to Wakanda due to the COVID-19 pandemic. The government has closed the country's borders to protect its citizens' health and safety. Peru has no magical mineral wealth which needs to be protected from foreign threats, but rather, in normal circumstances, it welcomes visitors from abroad. Such visitors do not come to loot precious minerals, but rather to enjoy Peru's natural, historical and cultural heritage. Tourist attractions for a country such as Peru, with such an ancient and rich history, are among its main assets and are an important source of income.

Effects of COVID-19

The closure of Peru's borders and the restrictions placed on international flights to and from Peru have had a highly negative effect on tourism and its related industries. For instance, in 2019 tourism was worth $4,784 million to the Peruvian economy, but only $900 million has been earned from tourism in 2020 thus far. This includes earnings from the first quarter of 2020, during the majority of which the aviation and tourism industries performed at full capacity.

The dramatic situation caused by the COVID-19 pandemic demanded the implementation of immediate and drastic measures on a number of fronts, including the imposition of limitations on air transport and the closure of borders. The aviation industry was fully aware of the gravity of the situation, accepted it and worked from day one on the best means and practices to enhance measures – already in place for biohazards – to protect passenger safety and adopt the protocols set out by the government. Undoubtedly, the costs which these efforts entailed are far less than the losses that airlines have suffered since the beginning of the pandemic. Moreover, these measures were introduced under the reasonable assumption that the prohibition on air transport activities would be in place only for a limited number of months.

However, this has not been the case. In principle, international air transport in Peru was expected to resume during Phase 4 of the resumption of economic activities in August 2020, but August 2020 has passed and there are rumours that international flights will begin again in October 2020 or, most likely, at some point before the end of 2020 or in early 2021. While the COVID-19 situation is expected to be transitory, some of the measures to combat it look set to have permanent effects, which shall lead policy makers and political leaders to evaluate whether the moment to reassess such measures has arrived. Relevant domestic and international air carriers in Peru, Latin America and the world are closing routes, furloughing and laying off workers, returning aircraft, defaulting on the payment of (sub)leases to (head)lessors and political leaders in office have other concerns.

While it cannot be ignored that COVID-19 is a health emergency and has produced much pain, sorrow and grief to the numerous families grieving their loved ones, in Peru thousands, if not millions, of individuals will lose their jobs, see their income reduced, see their companies fall apart, watch their personal projects go up in smoke or, simply, be deterred from experiencing what they love the most (eg, visiting their family abroad, exploring new places and enjoying life) due to restrictions on mobility between countries and the prohibition on international air transport services.

Comment

In the particular case of Peru, a country with major tourism potential, the time for reassessment has arrived. The aviation industry should at least expect the government to provide clarity with regard to when international operations for passengers will be resumed. Certain prohibitions can neither last, nor give the appearance that will last, forever.

For further information on this topic please contact Fernando Hurtado de Mendoza at Kennedys Law LLP by telephone (+51 1562 5150) or email ([email protected]). The Kennedys Law LLP website can be accessed at www.kennedyslaw.com.