NASSAU, Bahamas — Deputy prime minister and minister of finance Peter Turnquest projections reveal that, the costs from the COVID-19 crisis could total $1 billion over four months. The projection is on the high end – based on model assumptions on the likely impact of the novel coronavirus in The Bahamas.
“We ran three scenarios – low, medium and high impact – based on assumptions of varying degrees of losses for tourist arrivals over four months,” he said in the House of Assembly.
“The projections produced by these scenarios are by no means precise and all-encompassing, as the fallout in tourism will have a cascading impact on a number of other sectors within the domestic economy. However, the outcomes for each scenario within this preliminary assessment will help us to adopt a reasonable and responsible approach to contingency planning.
“While the total economic impact could be as low as $258 million over the next four months to June 2020, we are inclined to focus on the high impact scenario, which assumes 100 percent loss of cruise visitors and 80 percent of stopover visitors.
“In fact, recent developments in the industry would suggest a tilting of the possible actual outcome to this extreme scenario, which could result in a total economic loss, including additional public sector spending requirements, of as much as $1 billion.”
Turnquest said of that total, $832 million is projected for lost tourism-related expenditure as a result of the reduced visitor count.
“The direct hit on government revenue is placed at an aggregated $108 million – $48 million for direct border taxes paid by visitors, and a total of $60 million for potential Value Added Tax (VAT) and import duty losses.”
In recent days, five major cruise lines — Carnival Cruise Lines, Norwegian Cruise Line, MSC Cruises, Disney Cruise Line and Royal Caribbean Cruises — announced that they would pause their cruise itineraries as a precautionary measure amid a worsening COVID-19 (novel coronavirus) pandemic.
Air travel has also slowed significantly as countries around the world implement travel bans.
Republished with permission of the Nassau Guardian
