PATHWAY TO RECOVERY CAIRNS - FROM COVID-19 - Cairns Regional Council
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MAY 2020 CAIRNS PATHWAY TO RECOVERY FROM COVID-19 survive stimulate recover thrive
the impact
C airns’s proximity and connectivity to Asia and the Pacific, together with its significant regional population base (larg-
est of any region in Northern Australia), means it is well positioned for long term growth and prosperity. Immediately
prior to COVID-19, the Cairns economy was in a strong position with Gross Regional Product (GRP) growth exceeding the
Queensland and Australian rates of growth and unemployment below both the state and national level. However, with an
export led economy particularly reliant on tourism and aviation connectivity, Cairns is susceptible to the impacts of global
‘shocks’ such as COVID-19 and the Global Financial Crisis (GFC). Independent economic analysis indicates the Cairns
economy will be one of the hardest hit of any region in Australia as outlined below.
BEFORE COVID-19
$9.6B 16
FORECAST
%
GRP DROP 12.4% 12%
GROSS REGIONAL $386M CAIRNS
AUS QLD
IN JUN 20 QTR
PRODUCT (GRP)
82,500
SECOND MOST SEVERELY AFFECTED
$4.7B REGIONAL CITY IN AUSTRALIA IN % JOBS LOST
AND % LOSS OF GRP (JUN 20 QUARTER)
+
LOCAL JOBS EXPORT VALUE
STRONG GRP 7 ,700
JOBS LOST
21,000 JOBS
SUPPORTED BY
JOBKEEPER*
GROWTH 3 .5PA
%
OVER THE THREE
YEARS TO JUNE 19
CAIRNS 2QLD
.2 PA
%
2AUS
.2 PA
%
HIGHEST NUMBER OF JOBKEEPER RECIPIENTS
(EMPLOYERS) OF ANY POSTCODE IN QUEENSLAND
WITHOUT JOBKEEPER, JUN 20 UNEMPLOYMENT FORECAST TO EXCEED 15%
LOW UNEMPLOYMENT
UNEMPLOYMENT FORECAST
CAIRNS QLD 6.0%
(DEC 19) 43. % AUS 5.2%
(JUN 20)
CAIRNS QLD 10.5%
12.3 % AUS 10%
SERVICE POPULATION
198,000
SERVICE POPULATION
167,000 RESIDENTS & 31,000 VISITORS (DEC 19)
167,000
RESIDENTS ONLY. MANY RESIDENTS HAVE LOST
12,286 TOURISM
THEIR JOBS OR HAVE REDUCED CAPACITY TO SPEND
JOBS OF BUSINESSES
14.9% OF TOTAL CAIRNS JOBS REPORTING
4.9M
NEGATIVE EFFECTS
AIRPORT PASSENGER MOVEMENTS
AIRPORT PASSENGERS 96.5 %
DOMESTIC
99.9 %
INTERNATIONAL
YEAR ENDED 31/12/2019
10
AIRPORT BNE
PASSENGER
MOVEMENTS TO
POPULATION
CNS
31.6
9.7
SYD
% HOTEL
OCCUPANCY
RATIO 9.0
LOWEST EVER ON RECORD
*Estimate based on a straight line labour force based pro-rata of national JobKeeper statisticsCairns’ distance from metropolitan capitals and its reliance A NOTE OF
on tourism and aviation mean economic recovery times will APPRECIATION
likely be longer than for other parts of the country.
T he Australian and Queensland
Governments are to be
commended for their world-leading
The Global Financial Crisis (GFC) provides an indication of how response to the COVID-19 pandemic.
long the Cairns economy may take to recover from COVID-19. This response has required a
12
Following the GFC, it took: delicate balance between the human
10
and social impacts of the crisis and
8
YEARS
8
YEARS YEARS
YEARS
its impacts on the economy and
people’s livelihoods. Containing and
supressing the spread of COVID-19
within Queensland and Australia
for international for economic growth for the unemployment for the job to population
visitation to return to in Cairns to return to rate in Cairns to fall to ratio to return to has been a major achievement.
‘pre GFC’ levels the State level the State level the State level The range of immediate support
measures implemented by both the
State and Federal Governments are
UNDER THE ‘BEST Actual/Forecast TNQ Visitor Expenditure ($ million) also welcomed and appreciated.
CASE’ SCENARIO, IT
Without these measures, economic
SOURCE: TOURISM TROPICAL NORTH QUEENSLAND
WILL TAKE AT LEAST BEST CASE
impacts and job losses within the
5 YRS
$3500.0
$3450.0
$3446.1
Cairns region would have been much
$3000.0 MID CASE
worse. The Federal Government’s
FOR TNQ VISITOR $2460.0 $2770.2
$2500.0 $2676.0 JobKeeper program has been
EXPENDITURE TO
RETURN TO particularly important in supporting
$2000.0 WORST CASE
2019 LEVELS. employers and employees during
$1675.5
$1500.0 this difficult time.
$1235.8
$1000.0
$901.8
$500.0
2010 2011 2012 2014 2015 2016 2017 2018 2019 2020 2020 2021 2022 2023 2024 2025
Q1 Q2
Whilst the outlook is daunting, a phased plan coupled with targeted government support can see the Cairns
economy recover from the COVID-19 crisis more quickly than the recovery times experienced post GFC.
Given the depth and potential duration of COVID-19 economic impacts on Cairns, the support required for
recovery will likely be greater and more sustained than that required in other regions.
A phased plan for economic recovery & prosperity
The recovery plan for Cairns
will follow four distinct phases.
This approach will not only
see the Cairns economy return
0 TO 2 1 TO 5 >5
to the position of strength NOW YEARS YEARS YEARS
it was in ‘pre-COVID’, it will
also build a more diverse and
resilient economic foundation
supporting sustained economic
survive stimulate recover thrive
growth and prosperity in the
long term. As the region plots
this path to recovery and Focus on the Focus on the projects, Continued Leverage
immediate support programs and policy implementation of an the stronger,
prosperity, targeted support
measures needed that will create economic recovery more resilient
from the Federal and State to help businesses employment and plan that will return economic
Governments will play a crucial survive the crisis and economic activity the economy to foundation for
role. Whilst Cairns is still be in a position to in the short term and ‘pre-COVID’ levels long term growth
currently in the ‘Survive’ phase, recommence/ rebuild business but with a more and prosperity.
we are progressively turning re-escalate operations confidence. diverse and resilient
our attention to the ‘Stimulate’ and reemploy staff as foundation.
the crisis passes.
and ‘Recover’ phases to ensure
there is a clear pathway out of
the crisis.
Note: There will be a level of overlap between the Stimulate and Recover phases to provide a seamless transitionPlanning for Cairns’ recovery
is already well underway
A suite of business
survival and stimulus THE ‘SHUTDOWN’ OF THE TNQ VISITOR ECONOMY
initiatives has already IS COSTING THE REGION $10 MILLION PER DAY IN
LOST VISITOR EXPENDITURE
been identified for
consideration by the
various levels of key business
survival JobKeeper extension
government. support needed
These initiatives have been
developed by the city’s
Economic Response and Reestablishment of
Recovery Sub-Committee key stimulus
initiative needed domestic aviation capacity/
(ERRSC), chaired by Cairns
connectivity coupled with
Regional Council’s CEO with
investment in destination
representatives from the
Queensland Government,
marketing and the
Tourism Tropical North progressive/accelerated
Queensland, Advance relaxation of domestic
Cairns, the Cairns Chamber travel restrictions
of Commerce, Regional
Development Australia Tropical
North, the FNQ Regional
Organisation of Councils,
Cairns Airport and Ports North.
The ERRSC also engages with a
formal industry and business
reference group comprised of
around 50 representatives from
a broad range of businesses
and industry sectors.
The one thing that would have the biggest impact on economic
recovery in the short to medium term is the re-establishment of
domestic aviation connectivity and capacity into Cairns, coupled with
investment in destination marketing and the progressive/accelerated
our highest easing of domestic travel restrictions. This will be vitally important in
priority returning the city’s service population to ‘pre COVID’ levels as soon
as possible and getting the local economy moving again.The four phases to economic
recovery and prosperity
survive The extension of JobKeeper and other immediate support measures
1
will be critical to business survival in Cairns.
The support from both the Queensland and business when economic activity returns.
Australian Governments to date has been We also respectfully request that an
substantial and is welcomed with many of the extension of the Queensland Government’s
business survival initiatives identified by the suite of business survival support
ERRSC already actioned. For Cairns however, measures (payroll tax relief, electricity
it will be vital for the Federal Government’s support, lease fee waivers etc.) be
JobKeeper wage subsidy to be extended to considered for the Cairns region. The recent
March 2021. The depth and potential duration easing of regional and intrastate travel
of economic impact on Cairns warrants this restrictions is also an important step in
extension and will help businesses survive rebuilding the visitor economy on which so
the crisis and be in a position to resume many Cairns businesses depend for their
operations, reemploy staff and rebuild their survival.
During this phase, the fast tracking of capital works already underway in Cairns
needs to be a priority together with new streams of investment. Re-establishment
stimulate of domestic aviation connectivity, investment in destination marketing and the
easing of interstate travel restrictions will also be critical.
2
Projects such as the Cairns Convention Centre • Northern Australia Infrastructure Fund – Reset
refurbishment and extension, Bruce Highway for Recovery
(Cairns South) Road Upgrades and Wangetti Trail • Tourism funding (destination marketing)
- connecting Cairns and Port Douglas for walkers • Cairns Esplanade Dining Precinct
and cyclists, need to progress as a matter • Northern Beaches Leisure Trail
of urgency. A number of additional stimulus • A range of funding programs supporting
initiatives have been identified by the ERRSC economic recovery for regions severely
and included in a detailed report available on impacted by COVID-19
Council’s website. These initiatives fall into three
Above all, the reestablishment of domestic
categories: projects; programs; and policy. The
aviation connectivity and capacity, coupled with
initiatives would provide benefits across a broad
investment in destination marketing will be
range of sectors and support short to medium
critical for short to medium term recovery.
term economic recovery, job creation and
This needs to occur in parallel with the
economic resilience. Initiatives include:
progressive/accelerated easing of interstate
• CQUniversity - New City Centre Campus
travel restrictions.
• Cairns University Hospital
• Cairns Gallery Precinct Whilst the domestic visitor market will be
• Stage 2 CQUniversity Asia Pacific Aviation Hub the immediate focus, our attention will
• HMAS Cairns Upgrade progressively turn to the international market
• Cairns Marine Maintenance Precinct and international aviation connectivity as and
• Pacific Patrol Boat/Guardian Patrol Boat when international travel restrictions ease. A
Training ‘watch and act’ approach will be adopted in
• Export Market Development Grant (EMDG) this regard given the return of international
Reset and Reimbursement travel will be largely dependent on the
• Commonwealth and International Supported ability of countries throughout the world to
Places (James Cook University Medical School) effectively bring COVID-19 under control.
Further details of the above initiatives are set out in a detailed Preliminary Report on Stimulus Initiatives
(available here: www.cairns.qld.gov.au/council/covid19/recovery)The four phases to economic recovery and prosperity (continued)
Planning for the long term economic recovery of Cairns is already well underway
with collaboration from all levels of government, business and the community.
recover
3
Facilitated by representatives from the State and Federal level. The Cairns Economic
Queensland Reconstruction Authority (QRA) Recovery Plan is expected to be available in
using a proven recovery planning methodology late July 2020 and will set out the support and
and incorporating significant stakeholder input required from all levels of government,
engagement, the local recovery planning industry, businesses and the community more
process will provide the road map for Cairns’ broadly. Initially covering a period of two
economy to return to ‘pre COVID-19’ levels but years, the plan will be a ‘live’ document that
with a stronger, more resilient foundation. will continue to be updated and extended. It is
The plan will align with and feed into recovery also expected to inform a longer term strategic
planning activities being undertaken at the economic plan for the Cairns region.
The first three phases of recovery will ensure there is a strong foundation
thrive for Cairns’ long term economic growth, prosperity and resilience. However, a
4
return to the ‘status quo’ cannot and will not be our goal.
This crisis provides an opportunity to reshape Potential areas of focus for consideration for
and reimagine our economy in a way that will our region include:
provide an enduring legacy for the generations • Food production
that follow. Transformation will be required to • Strategic location (physical proximity and
ensure we take advantage of Cairns’ unique connectivity to the Asia Pacific region)
competitive advantages and the macro trends • Renewable energy and the ‘green’ economy
occurring at a global level. This phase will be more broadly
informed by the Cairns Economic Recovery • Tertiary education
Plan developed in the ‘Recover’ phase as well • Tourism
as the longer term strategic economic plan • Support for a skilled and growing population
that evolves from that process.
For more information, see: www.cairns.qld.gov.au/council/covid19/recovery
or email economicdevelopment@cairns.qld.gov.au
The Cairns Pathway to Recovery from
COVID-19 is proudly supported by the
following organisations who are also ADVANCE ADVANCE
active members of the Cairns Economic CAIRNS
OUR REGION ONE VOICE
CAIRNS
OUR REGION ONE VOICE
Response and Recovery Sub-Committee:
Ribbon Grid
Economic data included in this paper has been extracted from a report ‘Cairns Economy: Impacts from COVID-19’ prepared by .idConsulting Pty Ltd and Cairns Regional Council.
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