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Coronavirus: Tourism sector asks B.C. government for $680M stimulus package

B.C. tourism industry asking province for major bailout
A coalition representing the province's more than 19,000 tourism and hospitality operators is seeking a $680 million recovery stimulus package from the B.C. government to help the sector survive the devastating impact of COVID-19 travel restrictions. Ted Chernecki reports.

British Columbia’s hard-hit tourism industry is asking for a major bailout.

A coalition representing British Columbia’s more than 19,000 tourism and hospitality businesses has presented the B.C. government with a recovery stimulus proposal that would see the government put forward $680 million from its $1.5-billion recovery package towards the sector.

13 COVID-19 cases now linked to private parties in Kelowna involving tourists.
13 COVID-19 cases now linked to private parties in Kelowna involving tourists.

The funding would help the tourism industry, which has been impacted by severe travel restrictions during the COVID-19 crisis,including the closure of the US-Canada border to all but essential travel.

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“Unfortunately, as the only industry almost entirely based on the discretionary movement of people, the tourism and hospitality sector has been the most severely impacted by far by COVID-19 due to business closure orders and restrictions on personal travel, as well as the closure of international borders,” reads a statement issued by the Tourism Industry Association of BC (TIABC).

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“Virtually the entire sector was shut down resulting in extensive layoffs, with many businesses having closed without the cash flow to reopen, and thousands more desperately trying to maintain solvency.”

In 2018, B.C.’s tourism sector generated $4.5 billion in direct tax revenues from $20.4 billion in direct visitor spending. The industry accounts for more than 300,000 workers.

The tourism sector’s long-term economic outlook is “the bleakest for any industry,” according to the TIABC.

B.C. tourism survival concerns
B.C. tourism survival concerns

Best-case projections would still see a $14.8-billion decline in tourism revenue, a 69 per cent decline from 2018 numbers.

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“The existing suite of packages aimed at the overall economy are appreciated and helpful, but not sufficient to sustain the B.C. tourism and hospitality sector for the foreseeable future from this unexpected pandemic,” Tourism Industry Association of BC chair Vivek Sharma said.

“The only way we can prevent generations of lost economic activity, jobs, and tax revenues is by acting decisively now with innovative and creative solutions that recognize the importance of this sector, which is the face and brand of British Columbia to the world and one of the strongest drivers of B.C.’s economy.”

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The proposed stimulus package includes three parts.

The first part is nearly $475 million to help sustain and maintain solvency for businesses that have prospects to return to profitability over the next 18 months. The industry suggests this could include the provision of low or no-interest loans with an extended payback period.

The group is also asking for $190 million to help businesses adapt to coronavirus-related health and safety requirements.

The proposal also recommends a joint industry-government task force to work alongside existing industry organizations and networks to finalize funding parameters, application processes, and monitoring and evaluation mechanisms.

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“For decades, tourism has been a strong and consistent economic engine for the province and significant source of employment in every B.C. community,” Sharma said.

“What we are asking for is a return on the contributions the tourism and hospitality sector has made to the provincial and national economy over those decades. Essentially, we need an initial investment of $680 million to save an industry that is worth more than $20 billion per year. Without this support, our sector could see upwards of 100,000 jobs lost in 2020 and thousands of businesses permanently shuttered.”