Discrepancies in the Government for the bailout of the hospitality industry will cost the sector 6,000 million at Christmas

The industry is asking for aid of 8,500 million euros and estimates that 100,000 bars and restaurants will close by the end of the year.

The hospitality industry explodes: bars and restaurants ask for a rescue plan in the face of the wave of closures

for second consecutive week the Government leaves the hospitality rescue plan in the drawer announced by President Pedro Sánchez for weeks. Apparently, the discrepancies between the Ministries of Finance and Economy continue to delay this plan, according to sources consulted. A necessary strategy that could cushion the drop in sales and the closings that are expected in the industry.

“The aid that the sector expects will not arrive in the amounts that are needed and that is why they are delayed”, indicate sources close to the negotiations. Something that added to the discrepancies within the Government, make the hospitality sector itself lose hope despite the fact that the Government does not expect to approve the aid before the end of the year.

And this, logically, translates into more uncertainty and losses for the tourism sector that considers the Christmas campaign lost. “We are going to lose 6,000 million euros these days, more than 50% with respect to the 11,000 million billed in 2019 ”, the president of Hospitality of Spain, José Luis Yzuel, assured Invertia.

A Christmas that they foresee will continue to be marked by schedule restrictions in the Autonomous Communities, preventing, except in Madrid, the possibility of having dinners. “Group dinners, which were the great package, are not going to be held”, points out the president of the employer’s association, who details that “company dinners had the addition of having drinks and going out to other places that will now be closed.”

In this situation, what qualify as “very serious”, the sector cannot “make estimates or numbers” for the future. And neither “can they continue to get into debt with ICO credits,” they denounce.

Aid in Europe

While waiting for the Executive to finally approve the aid to bars and restaurants, the bosses advance that only a plan like that of some European countries could change the situation.

A) Yes, Germany and the Netherlands have allocated between 10,000 and 15,000 million euros respectively, followed by France, in which 6,000 million have been approved for direct aid for the hospitality industry.

In Spain, the hospitality sector, through the Juntos con la Hostelería platform (made up of FIAB, Hostelería de España and Aecoc), requested direct aid to the sector worth 8,500 million euros to the autonomous communities and the Minister of Industry, Commerce and Tourism, Reyes Maroto.

Likewise, for months the sector has been demanding the exemption of 100% of the Social Security contributions, the suspension of the payment of the self-employed contribution. They also demand the lengthening of terms of ICO credits, the fractional payment of corporation tax and the deferral of VAT payments, among other measures.

At the moment, only some Autonomous Communities have offered direct aid to bars and restaurants and even companies such as Mahou have invested 20 million euros in conditioning terraces. But no sign of the national plan.

100,000 bars will close

With this panorama, the situation is especially delicate. Today more than 65,000 hospitality businesses have already closed, More than 350,000 jobs have disappeared and the turnover in the sector has fallen by more than 50% compared to the previous year.

A few days ago, Hostelería de España recalled that one out of every three bars will disappear in Spain due to Covid; data that did not take into account the current closings of the CCAA. So “it can go further with the new restrictions in Spain”, acknowledges the president of Hospitality of Spain.

We are talking about more than 100,000 stores that will close as a result of the impact of the measures anti-Covid. Also at stake are between 900,000 and 1.1 million jobs, between direct and indirect, according to the worst-case scenario forecasts.

It should be remembered that the hospitality industry is a sector that contributes 6.2% of GDP, It employs 1.7 million people and contributes about 17,500 million euros to the state’s public coffers, according to data for 2019. In addition, it is of great importance for tourism.