It’s calling for an urgent reprioritisation of government expenditure to inject $17 million of additional grant funding into business continuity support.
To promote the country’s economic recovery, the Taskforce’s recommendations includes supportin the form of a monthly sum to address cash-flow burn of businesses who cannot reduce costs further, such as insurance, rental, power, access to low interest finance and a government guaranteed loan scheme.
Before the Covid-19 pandemic hit, overseas visitors contributed more than $5 million a week to the local economy.
The Taskforce says the government’s immediate priority should be to negotiate a shared travel bubble with New Zealand to aid the tourism-led recovery of the economy.
Chairman Fletcher Melvin said tourism was the only industry that could support a quick recovery. “This hinges on New Zealand’s successful elimination of Covid-19 and agreed health measures to protect the Cook Islands,” he said.
The country’s economic crisis and its impacts to local businesses are bleaker than initially thought.
Based on extensive research conducted earlier this month, the Taskforce said the funding is needed before the next phase of the economic recovery package comes onstream in July.
And the stakes couldn’t be higher.
Every month the borders remain closed deepened the country’s economic crisis, Melvin said.
Without additional funding to the private sector, the Taskforce predicted widespread loss of jobs and business closures, loan defaults and people leaving the country in search of overseas employment – all giving rise to unprecedented social upheaval.
“It cannot be stressed enough that ongoing support is required to ensure that businesses are in a position to hit the ground running – with both their capital and labour-force intact – as soon as the borders open so they may once again play a vital role in the economic well-being and recovery of the Cook Islands.”