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Some 700,000 small and medium-size businesses will receive cash payments of between AUD 2000 and AUD 25,000 to help pay wages or hire extra staff, under the Federal Government’s economic stimulus package designed to address the impact of the coronavirus on the Australian economy.

The stimulus package includes a AUD 1 billion fund to help the tourism sector, which was already battered by the bushfires. The new measures have been generally well-received by the tourism industry, though some question whether they will be enough, if international tourists continue to stay away.

In Australia and around the world, travellers desperate to avoid the virus have sent tourism reeling. Governments are playing catch-up. The whole of northern Italy is in lockdown.

In latest developments:

  • The World Health Organisation declared COVID-19 coronavirus outbreak a global pandemic, sending stocks diving around the world.
  • Exchange rates also shifted. The Australian dollar was this morning worth (market mid-rates): 62.8 US cents; 56.2 Euro cents; 49.9 British pence; 1.02 New Zealand dollars.
  • American actor Tom Hanks and his wife Rita Wilson were diagnosed with coronavirus on Queensland’s Gold Coast and admitted to hospital for treatment.
  • US President Donald Trump suspended travel between the US and Europe, prompting the following comment from US Travel Association president and chief executive Roger Dow: “Temporarily shutting off travel from Europe is going to exacerbate the already-heavy impact of coronavirus on the travel industry and the 15.7 million Americans whose jobs depend on travel.”
  • The details: the US is banning entry to anyone (apart from Americans or US permanent residents) who has visited any of  the 26 European countries which form the Schengen zone (where there are no passport checks between internal borders) within 14 days of their entry to the US. Britain is not in the Schengen zone. European travel and leisure stocks plunged 9.3% after Trump’s announcement.
  • More than 25% of the Australian stock market’s value, or more than AUD 520 billion, has been wiped from the value of Australian shares since 21 February 2020. In the US, Wall Street’s Dow index yesterday suffered its biggest one-day percentage drop since the 1987 crash.
  • Event cancellations swept everything from Disneyland and Broadway to big musical and sporting events. An announcement that Formula 1 will not be racing at the Australian Grand Prix in Queensland this weekend (in the wake of a McLaren team member contracting coronavirus) is on the cards.
  • Viking Cruises temporarily suspended all of its river and ocean cruises, for embarkations until 30 April 2020. Chief executive Torstein Hagen said “the situation has now become such that operating as a travel company involves significant risks of quarantines or medical detentions, which could diminish the travel experiences for which our guests have been planning”.
  • Cathay Pacific chairman Patrick Healy said: “We expect to incur a substantial loss for the first half of 2020.”
  • In response to the coronavirus, India has announced all existing visas, including the visa-free travel facility for OCI card holders, will be suspended from noon GMT today (13 March 2020) until 15 April 2020 at the port of departure. Visas issued to diplomats, officials, UN/International organisations, employment and project visas are exempt. DFAT advises travellers: “Contact your airline or travel agent regarding your travel arrangements. Visas for all foreigners currently in India remain valid. If you’ve compelling reasons to travel to India, contact your nearest Indian embassy or consulate.”
  • DBRS Morningstar, a global credit ratings business, said insurance clients in the hospitality and tourism sectors were “particularly exposed to incurring losses as a result of large customer concentration in one location. Event cancellation insurance is most likely to pay out compared with other policies. However, travel, business interruption, workers’ compensation, and general liability policies could also be affected.”

Against all this, Australia is fighting back. The Australian Tourism Export Council (ATEC) welcomed the Federal Government’s stimulus package.

“ATEC is pleased the Government is making a solid commitment to sustaining the tourism industry in the wake of the COVID-19 outbreak,” ATEC managing director Peter Shelley said of yesterday’s announcement.

“We have been greatly concerned by the impact the contraction in international travel will have on tourism’s future – we just can’t afford to lose the important distribution channels currently in place.  We are particularly happy with the commitment to support businesses where there has been a supply-chain breakdown as a result of the virus outbreak.

“Despite the bushfires and subsequent COVID-19 crisis, the industry has been doing what it can to keep the doors open – this is a dire time and the industry needs every bit of support it can get.

Shelley said money for Austrade to explore alternative export markets aligns with ATEC’s focus on training and development and small business grants along with wage subsidies and BAS deferral will help to keep the wheels turning and maintain positive trade relationships. Business grants similar to EMDG would go a long way to encouraging capable tourism exporters to invest in new markets.

ATEC said it stands poised to ramp up support programs for the industry, using its already successful learning and development platform to deliver meaningful benefits for export tourism businesses across the country.  Many of ATECs programs are available via an online learning platform and can reach regional businesses.

Training programs available for immediate action include:

  • Industry training programs designed to arm businesses with an understanding of the China, Japan and India markets with a focus on distribution, experience and product development
  • Virtual Trade Shows to allow businesses to continue building relationships in order to re engage trade quickly post COVID-19
  • International Ready training to move domestic tourism product towards export which can be driven throughout the tourism regions.

“Now is the time for action and ATEC looks forward to working with the Government in quickly delivering programs to Australia’s tourism industry which can help to put it back on its feet.”

Edited by Peter Needham