Aid package hope for tourism sector

A high-level meeting is set to be held tomorrow to discuss a possible stimulus package for the kingdom’s hospitality and tourism sector.

Industry insiders are hoping Bahrain will adopt initiatives similar to the recent UK government’s “eat out to help out” campaign which will offer discounts to encourage people to support struggling restaurants.

Under the plan, the British government will pay 50 per cent of the diners’ bills next month and reduced Value Added Tax (VAT) from 20pc to 5pc.

“We should provide incentives and discounts to rebuild confidence and break this psychological barrier due to Covid-19,” said hospitality and tourism committee chairman at the Bahrain Chamber of Commerce and Industry Jehad Amin.

“The UK’s decision to help the hospitality sector is a good one and similar steps could be taken in Bahrain.

“We can see how restaurants are opening up gradually in the UK after three months of lockdown, with safety measures in place, and this can also be a learning experience for us.”

Mr Amin believes a starting point to help the sector in Bahrain would be to look at the issue of VAT until the end of the year.

“No one is going out or eating out and we need to reverse this trend by similar ‘eat out to help out’ campaigns in Bahrain, perhaps where the government pays part of the restaurant bill.”

He also believes fully promoting the ‘staycation’ option – which entices Bahrainis and expats to stay on the island to explore and enjoy the many hospitality options available here – was well worth pursuing.

“This is the only way out right now to help the hospitality and tourism sector,” Mr Amin added.

According to conservative estimates the hospitality sector may pick up by September, although a full recovery is only likely by next year.

The partial closure in businesses, stopping flights into the kingdom, plus visa restrictions and, most importantly, closure of King Fahad Causeway since March 8, has put travel and tourism among the most badly hit sectors from measures introduced to try and prevent the spread of the virus.

Meanwhile, the GDN has secured a letter sent to Bahrain Tourism and Exhibitions Authority chief executive Nader Almoayyed in which hoteliers have listed their pleas for help.

This includes the waiver of VAT this year and government fees, six months exemption of utility bills and a special financial package, with flexible loans and payment facilities.

“The tourism sector is among the worst affected sectors due to the pandemic. It has seen the closure of restaurants, gyms, spas, cinemas and other facilities,” stated the letter.

“There are no room bookings, meetings or weddings taking place, while the fixed operating costs remain high, that includes paying salaries and housing employees.”

Experts say the estimated loss for Bahrain’s hospitality sector at the end of the year could reach BD500 million, including BD400m for airlines and BD100m for hotels, travel agents, event management companies and allied sectors.

Government officials during a virtual meeting with legislators last month said that travel through Bahrain International Airport had dropped by 98pc since the outbreak.

They also revealed that visitors to shopping malls dropped by 91pc, while hotel occupancy dropped by 72pc, and fuel sales reduced by 32pc.

Another key survey conducted by the BCCI that covered 1,180 participants found 71pc of business owners from the tourism and hospitality sector expect to close their companies within the next six months, while 52pc from the sector expected to lay off more than 20pc of their staff during the upcoming period.

Source: http://www.gdnonline.com/Details/837441/Aid-package-hope-for-tourism-sector