Pacific tourism insulated from effects of coronavirus

The Pacific tourism industry may be “insulated” from the economic impacts of the Wuhan coronavirus currently spreading across the globe, A.N.Z. economists predict.

Kishti Sen and Tom Kenny, two international economists working for the bank in Fiji, report that the Pacific Islands may be seen as a “family friendly and safe” destination in the wake of both the new coronavirus, and the bushfires in Australia.

In a new Pacific Insights note circulated to A.N.Z. clients, the economists say while Governments across the region have implemented travel bans or restrictions to prevent the arrival of the Wuhan coronavirus onto their shores, tourism won’t take too severe a hit.

“With the diligent monitoring and preparedness all governments are practicing, we believe the number of inbound visitors to the Pacific is likely to hold up this year, especially as the outbreak has occurred during the Pacific’s off-peak tourism season. 

“This means foreign reserves, G.D.P. (gross domestic product), employment and government revenue in tourism-dependent economies, such as Fiji, Vanuatu, Samoa and Cook Islands, are likely to remain intact.”

Samoa has been looking to cash in on the 140 million tourists per year Chinese market, embarking on an ambitious policy and tourism campaign known as China Ready.

Last year, Chinese tourists made up less than five per cent of all visitors to the Pacific, with around 2000 arriving on Samoa’s shores (Fiji saw 47,000, with arrivals from China having grown steadily since 2007.  

“If the outbreak is contained soon, we think around 15,000 Chinese visitors will be unable to make it to the Pacific in the short term,” the report states.

“This may be offset by higher arrivals from Australia, New Zealand and the United States. Economic conditions in these countries, in particular income growth, are still broadly supportive of international travel.”

The Australian market may prove to be the most promising, with historically low unemployment rates and data showing holiday making is still happening, Mr. Sen and Mr. Kenny said.

Fears and travel bans around the coronavirus may “divert” Australian holidaymakers from destinations in Asia to the Pacific Islands, at least in the near-term, as will the bushfires sweeping around their own country.

“Industry liaison suggests most prepaid package holidays are booked in January. Bushfires were in the headlines for most of that month. 

“The Pacific has a well-established brand as a family friendly and safe holiday destination, so we expect it to pick up some of the up-tick in Australians holidaying overseas.”

Late in 2019 when Samoa was hit by the measles epidemic that resulted in a state of emergency, the nation’s economy took a $22 million hit.

In January, Samoa Tourism Authority revealed tourism alone suffered by at least $10 million tala, with at least $2.4 million lost in cancelled hotel bookings alone (calculated from 40 out of Samoa’s 140 registered hotels).

The arrival of the Wuhan coronavirus would have had many hotels and tourism agents on edge as they waited to see how it would affect Samoa. 

This week, Samoa Airways released a video advert showcasing Samoa’s beauty, with lingering overhead drone shots of beaches, coral reefs and Samoan people dancing, or blowing a conch shell dripping in the sunrise. 

The two-and-a-half minute video has no words, only music, and no messages except for the name of the airline at the end. 

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