Fáilte Ireland says there has been an 80% reduction in tourism revenue as a result of the pandemic.
The agency's CEO, Paul Kelly, says this amounted to a €6 billion loss in 2020.
Addressing a virtual industry event for those involved in the sector, Mr Kelly said the nature of the virus meant forecasting the future outlook was "nigh on impossible".
However, Fáilte Ireland is hopeful that "some kind of domestic tourism activity" could start in the summer.
The outlook for international tourism is less clear.
In the short-term, Mr Kelly advised businesses to plan on the basis that the domestic market would be the primary source of revenue in 2021.
In her address to the online conference, the Minister for Tourism said there would be no "cliff edge ending" to supports for the tourism industry.
Minister Catherine Martin acknowledged that gaps remained in terms of assistance provided to some businesses in recent months.
She said a new funding package would provide an equitable level of payment to the Covid Restrictions Support Scheme (CRSS), for qualified operators.
The Minister said the Government would support the sector in the long-term through recovery and reopening, by ensuring appropriate supports were in place.
Fáilte Ireland says more than 5,000 people involved in tourism are watching the online conference.
In her contribution, Ruth Andrews, of the Irish Tourism Industry Confederation, said as well as the rollout of the vaccination programme, the sector needed assurances that financial supports would be extended at current levels until the end of 2021.
She also called for the redesign and relaunch of the Stay and Spend scheme, as a matter of urgency.