Industry, economy reeling from tourism “disaster”

Accom operators are reporting visitor cancellations totalling hundreds of thousands of dollars as coronavirus restrictions bite and tourism markets remain spooked by the recent bushfires.

And financial experts are warning the combination of threats could be a deadly one for the wider economy, NAB chief economist Alan Oster predicting Australia could take a $15 billion, 0.8 percent hit to GDP in 2020.

Jerry Schwartz, Australia’s biggest private owner of hotels with 15 regional and city properties, told The Australian coronavirus fears had prompted a major international drug company to cancel a conference at his Sofitel Darling Harbour hotel worth $300,000-$400,000.

His Fairmont Resort in the Blue Mountains, meanwhile, has endured a summer occupancy drought due to bushfires which saw its usual 90 percent occupancy cut to less than 20 per cent.

“The Fairmont has lost money and it is unable to pay its mortgage,” he said.

“It’s terrible.The regional hotels were affected by bushfires, now my city hotels will be affected by Chinese pulling out because of the coronavirus.”

Cairns, one of the most popular Chinese holiday destinations outside of the big cities, experienced 19,000 cancellations last week, a loss of some $10 million.

Tourism Tropical North Queensland chief executive Mark Olsen said: “It’s not just the cancellations, there’s also no new bookings. With the reduction in aviation capacity [late last year], bushfires and now coronavirus, it’s a triple whammy for the tourism industry.”

Further south, Gold Coast-based Koala Blue Tours operator Bill Egerton told CNN: “All tours inbound from China that have been booked with me were all cancelled – I lost 15 tours for February.

“The Chinese is about 10-20 percent of my business … I think the federal government doesn’t really understand the loss of income and the impact on businesses. The theme parks will suffer, the hotels will suffer…those big groups can be anywhere from 20 to 500 people. China is our biggest market for overseas tourism by far.”

Christine Zhang, director of a 40-staff Chinese tour operator in Victoria, says the coronavirus travel ban will severely impact her business and predicts it will cause smaller operations than hers to fold entirely.

“This is a disaster … it really isn’t fair,” she told the Sydney Morning Herald.

Other industry figures, though, are more upbeat about the time frame of the impact.

Experience Co CEO and former Tourism Australia boss John O’Sullivan, whose Queensland boat tour business has been affected by cancellations, predicts the sector will bounce back once the coronavirus had been contained.

“We know from SARS it recovered pretty quickly,” he said. “This industry is incredibly resilient and while this is never fun, we will recover. Things will return quickly.”

University of Western Australia economist Jakob Madsen agrees the Australian economy will bounce back from the fire and virus threats, but says tourism will be slower to recover due to overseas perception of the federal government’s climate policies.

“There is a chance that the tourist industry will be damaged for many years because the fires have put Australia in the international spotlight as being indifferent to global warming,” he told the Sydney Morning Herald.

“Tourism is political (and) the same applies to exports of education and goods,” 

Practical help

The WA government has announced a $2.85 million funding grant to support businesses immediately affected by cancellations due to the coronavirus and bushfires.

While the state enjoyed a strong peak season and was largely unaffected by bushfires, a recent survey showed 67 percent of tourism businesses were still reporting some impact from international bushfire coverage.

Australian Hotels Association WA chief executive Bradley Woods said: “This additional funding is very welcome and comes at a time when our local tourism, accommodation and hospitality industry is facing a virtually unprecedented dual threat from interstate and overseas events.” 

For accom operators worried about the practical challenges of managing the coronavirus, the federal government has issued fact sheets offering guidance aimed at both staff and guests.

The sheets detail actions that apply to anybody who has been in the primary affected areas in the past 14 days and provide guidance for hotel staff on how to engage with guests in self-isolation.

Click here to access the resources aimed at accom providers and here to access the resources aimed at hotel guests.

Tourism Australia describes the restrictions as “highly precautionary” and says the vast majority of people who present as being well are unlikely to be infected.

It has also provided phone numbers for state and territory public health authorities which can be used by any hotelier or staff member seeking more information:

ACT – call (02) 5124 9213 during business hours or (02) 9962 4155 after hours

NSW – call 1300 066 055

NT – call 08 8922 8044

QLD – call 13 43 25 84

SA – call 1300 232 272

TAS – call 1800 671 738

VIC – call 1300 651 160

WA – call 08 9328 0553

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