FHTA Tourism Talanoa: Inclusive Budget Hopes

FHTA Tourism Talanoa: Inclusive Budget Hopes

FHTA, 24 March 2022 – There’s a buzz of excitement and anticipation for the Government’s mini-budget to be announced this evening.

Every industry including tourism is looking forward to seeing how the increasing cost of business will be addressed and what measures will support the ease of doing business as the Fijian economy feels the increasing impact of supply chain challenges that
have been aggravated by the ripples of a faraway war.

In the mini-budget submission that the Fiji Hotel and Tourism Association (FHTA) put forward after consultation with the Ministry of Economy in February, we shared tourism’s challenges and recommendations.

The submission addressed three key areas for consideration that recognizes that tourism can continue to be Fiji’s key economic driver despite coming out of a hiatus that lasted almost two years.

And even while many SMEs that form a large part of the industry remain crippled by depleted cash flows and onerous new requirements to fulfil COVID Safety compliance.

These key areas noted short- and long-term initiatives that would support resilience, ensure an inclusive recovery and recognize the importance of practising sustainable tourism.

To support resilience and the ability to effectively bounce back quickly from the pandemic induced pain, the industry needs to be able to fully utilize prior budget incentives and capitalize on reduced operational costs that continue to be forced upwards by global economic impacts.

This supports getting staffing back as close as possible to original numbers with staff training a necessary part of new hires, skills enhancement and COVID compliance.

And any efforts to reduce operational costs ensures a business moving from closed to fully reopened and ready to compete for visitor numbers can focus on more productivity and efficiency if it is not decelerated by efforts to work its way through new tax systems or reproducing paperwork across regulatory agencies for compliance approvals.

One such measure we are hoping for is the continued review of the VAT Monitoring System (VMS/EFD) until applicable tourism taxes can be practically accounted for alongside VAT, which must consider challenges this imposes on the packaging and third-party transactions that are almost specifically tourism-related.

We continue to request the synergizing of regulatory agencies that are working hard to digitize their processes so that systems work to collectively reduce paperwork & improve productivity & efficiency.

In essence; to make it simpler and cost-effective to get on with your business.
Inclusive recovery recognizes that the tourism industry is made up of many different segments from which a host of supply chains run off.

The industry is not simply about the different sized hotels or resorts but encompasses the far more complicated network of services and products that makes Fiji a destination that can be considered a small, but fiercely competitive force alongside Hawaii, Tahiti, Bali and other, far better-resourced tourism destinations.

This network of products and services includes a phenomenal number, and a diverse range of experiences, activities and entertainment options that in turn reinforce the ability of tourism to reach deep into our furthest communities, employ vast numbers of the informal sector and is the support structure for thousands of SME’s.

We are acutely aware that many of these small businesses have yet to return or are still unable to reopen and that means that Fiji’s product offering is still woefully inadequate unless we find a way to bring them back.

If you cannot think of who these SMEs are; consider the sports fishing, village tours, river safaris, musicians, artisans, hiking and trekking explorations, quad biking, diving, kite surfing, water sports, backpackers, meke and dance groups, event organisers, florists, guides and many others in food-related areas like farmers and fishermen.

Our proposed measures address the need to ensure that tourism’s inclusivity is maintained and that it better support the recovery of many more SMEs or we risk our competitive edge to other destinations.

We are also very passionate about promoting sustainable tourism especially given the breathing space that the global lockdown afforded the environment.

Tourism fully supports Fiji’s focus on climate change on a broader scale, embracing sustainable practices, ensuring the long-term viability of the industry and providing us with another important opportunity to be able to showcase this to the world by living the example.

We have a significant opportunity to build back better and greener.

We should be recognizing and addressing the need for longer-term plans for formal waste management collection and recycling throughout Fiji and not just in urban areas.

Could we escalate plans to increase the supply for higher demand commodities like water, sewage treatment, waste management and power supplies for urban & rural areas, than is currently being supplied?

Over half of our tourism properties and businesses have been in operation since December 1, 2021, border reopening and we are hopeful that even more of these operators and supply chains will open their doors by the midway point of 2022.

As the largest economic driver in Fiji, it can, with target support, get back up again quickly.

With over 150,000 lives directly or indirectly affected by the industry, it can provide a lifeline to many families.

Tourism contributed $3b in taxes and foreign exchange earnings in 2019 and the industry while fully aware of the impact of the pandemic on our economy, understands that it can make huge inroads to reducing this impact and being the impetus towards positive economic growth.

The experts say that the economy is not expected to rebound to pre-COVID levels for at least three years.

While FHTA and the industry might be a little more optimistic about rebound levels, we acknowledge that several key milestones must be achieved beforehand.

We also believe that more business supportive policies introduced or maintained, can enable a faster industry and therefore economic turnaround.

And we have acknowledged this is not possible without Government and targeted policy support.

More and more visitors continue to flock through the arrivals at Nadi International Airport and we are quietly optimistic that this will continue if we get our entire industry back up again and not just a few areas.

But what is the growth we expect if we’re not aiming to better ourselves from the last time we had a full calendar year of fruitful economic activity?

We need all parts of the industry given equal opportunity to bounce back because we know the impact can and should be more inclusive.

By: Fantasha Lockington – CEO, FHTA (Published in the Fiji Times on 24 March 2022)