More than 500 Fijian businesses will declare bankruptcy this year.
According to a survey by the International Finance Corporation, a member of the World Bank Group, and the Ministry of Commerce, Tourism, Trade and Transport, more than 60% of tourism businesses surveyed by anticipate transitioning away from tourism activities if travel from source markets do not re-open by November this year.
The Fiji COVID-19 Business Survey: Tourism Focus received responses from over 3,500 businesses, including 620 tourism businesses.
The survey aimed to quantify the impact of COVID-19 on businesses with a specific focus on the tourism industry.
The survey revealed most businesses in Fiji need financial support with over 500 of the business surveyed facing bankruptcy by November 2020.
To continue operations, businesses also need health and safety certification, advice on business strategy, new markets and support to increase sales domestically.
Permanent Secretary for Commerce, Tourism, Trade and Transport, Shaheen Ali said Government has undertaken consultations with the Fijian business community to understand the impact of COVID-19 on them.
In considering the unprecedented scale of the crisis, the findings call for a more strategic partnership approach between Government, industry and development partners to accelerate recovery.”
The online survey was carried out from April 28 to May 15 and revealed that 71 percent of businesses surveyed were stable with the ability to save or growing pre-COVID-19 but the impact of the pandemic had left almost 1,200 businesses anticipating a 75% decline in revenue.
Businesses already implemented various measures to address the impact with 24 percent of businesses surveyed moving to online sales, 69 per cent offering promotions and discounts and at least 36 percent moving to new activities, away from their core business.
The survey revealed that 41% of staff from all businesses are on reduced working hours or days, 10 percent are on leave without pay and five percent have been made redundant.
Businesses were also surveyed on the impact of Tropical Cyclone Harold, which revealed that 49 percent of non-tourism businesses and 48 percent of tourism businesses surveyed suffered financial losses due to the cyclone.
IFC Country Representative for Fiji, Samoa, Tonga, Kiribati and Tuvalu, Deva De Silva said the survey has provided a glimpse of the impact of the pandemic on Fijian businesses, which is critical to the Fijian government and its partners in formulating a strategic response to the impacts of COVID-19.
The survey has recommended more support for the informal sector and a roadmap for the recovery of the tourism industry, training for tourism workers for the “new normal”, diversified marketing campaigns and more business support for micro, small to medium enterprises.
IFC’s support for the survey on the impact of COVID-19 on Fijian businesses has been complemented by the support of the Australian and New Zealand Governments under the Fiji Partnership. Australia, New Zealand and IFC are working together through the Partnership to stimulate private sector investment, promote sustainable economic growth and boost shared prosperity in Fiji.