Coronavirus: Hit to Otago’s economy expected

Dougal McGowan.
Dougal McGowan.
The economic impact of coronavirus on Dunedin and Otago is already being felt, and could cost the region tens, if not hundreds, of millions of dollars, the Otago Chamber of Commerce says.

Chamber chief executive Dougal McGowan yesterday told the Otago Daily Times the ripple effects of the virus — and the temporary ban on travellers coming from China — was already being felt in the South.

Some businesses, including rock lobster exporters, were finding it more difficult to get products into China, and the number of tourists and international students coming from China was already down, just as the peak season arrived.

The economic impact was mounting and could be significant, he said; products were unable to be shipped, tourists did not arrive to spend money and fee-paying students stayed home.

‘‘You will be talking in the tens of millions of dollars easily, depending on how long it goes for. It could be hundreds of millions of dollars for Dunedin and Otago,’’ Mr McGowan said.

Enterprise Dunedin director John Christie said his team was keeping ‘‘a pretty close eye’’ on developments and the impact for Dunedin, in what would usually be the busiest month of the year for incoming students and travellers from China.

There was already evidence numbers had dropped, as groups of package tours and independent travellers cancelled their planned trips, he said.

Depending on how long the travel ban remained in force, those delayed trips could also turn into cancellations.

‘‘[It is] hard to quantify at this stage, particularly in the tourism side of things, as to what that effect might actually pan out to be, but there will be an impact on the Dunedin tourism market.’’

It was fortunate that ‘‘good or bad, Dunedin doesn’t get hit as hard as the major tourism centres’’, he said.

‘‘Auckland, Rotorua and Queenstown will certainly feel that effect far greater than we will, but we’re going to see a bit of a pull-back.’’

How much of an economic impact would be seen here ‘‘depends how long it goes for’’.

About 600 students from China were due to travel to Dunedin for their first semester of studies, and Mr McGowan said their spending on fees, accommodation and other items made them an important part of the city’s economy.

Last year, it was reported New Zealand's international education sector had grown to 125,000 students in 2017, worth $5.1billion to the nation’s economy. Across Otago and Southland, that included nearly 8000 tertiary students and secondary pupils, mostly based in Dunedin, who together contributed $310million to the regional economy.

chris.morris@odt.co.nz

Comments

Unfortunately this is hitting other places around the world as well The Queensland is feeling it as well. It is out of Dunedin's control. Mr Christie needs to take a look closer to home with the damage his own Council is doing to Dunedin with the closure of the Octagon.

I agree and Mr Christie needs to look at the bigger picture. It's all very well taking a knock financially to which everyone can recover from but if the coronavirus gets a hold here then lives will be seriously at risk and isn't that far more important.... not that ANY politician would care.

People who die from the 2019-nCoV disease are even more hit.