Zika Virus Taking Bite Out of Puerto Rican Tourism

In the USA Zika has hit Puerto Rico harder than anywhere else. Over 1,170 confirmed cases have been reported with one death. The first case of Microcephaly in the US happened on this island off of the southeastern coast of the USA.

Puerto Rico has been suffering from a catastrophic economic crisis in recent years, and tourism is an important source of revenue for the small country and US protectorate. It is impossible to know the exact impact of the virus on tourism, but some observers have surmised that Zika is responsible for the cancellation of at least 42,000 hotel room reservations up until 2018. That is the equivalent of about $28 million in lost revenue for the hotels, restaurants and touring industries, said the executive director of Puerto Rico’s Tourism Company Ingrid Rivera.

People in the industry have seen the problem growing for months, and now it seems to be getting even worse.

“Cancellations left and right and up and down,” said Luis Alvarez Perez, owner of a luxury travel planning and relocation company in San Juan. “People just stopped coming.”

Tourism accounts for about 7 percent of the Puerto Rican economy, but this sector has been growing steadily over the years. A few officials have criticized the US Centers for Disease Control and Prevention for being overly alarming in their recommendations about Puerto Rico. The CDC is predicting that about 20 percent of the 3.5 million population could become infected with Zika, reaching a peak this coming summer.

“They’ve exaggerated the numbers,” Puerto Rico’s Health Secretary Ana Rius told The Associated Press. “We’re never going to reach those numbers.”

About James Cannon

James Cannon is an experienced hedge fund analyst. He has served on the advisory boards for various different Fortune 500 companies as well as serving as an adjunct professor of finance. James Cannon has written for a variety of Financial Magazines both on and off line. Contact James at james[at]businessdistrict.com