Tighter border controls will hurt travel, aviation industries: scholars

CNA File Photo
CNA File Photo

TAIPEI (CNA) — Taiwan’s latest border control measures to slow the spread of the new coronavirus disease (COVID-19), which include an entry ban on most foreign nationals, are likely to have drastic effects on the country’s travel and aviation industries over the long term, local scholars said Wednesday.

Huang Cheng-tsung (黃正聰), an associate professor at Providence University’s Department of Tourism, said if the COVID-19 pandemic and response measures last for more than six months, some 60 percent of Taiwan’s travel and aviation businesses may have to shut down.

Alex Lu (盧衍良), an associate professor at the Department of Air Transportation at Kainan University, said airlines may face a problem of liquidity, which would hamper their ability to repay their loans.

Stakeholders in the travel and aviation industries, meanwhile, said they are hoping to see a more effective bailout plan put forth by the government.

They said the government’s current plan, which allocates NT$4.2 billion (US$140 million) to bail out the aviation industry and NT$800 million for the tourism and travel sectors, is too complicated and will take effect too late.

Thirty percent of the tourism businesses in Taiwan cannot make it to September, when the bailout program is scheduled to start, said Ringo Lee (李奇嶽), chairman of Harula Tour Travel Service.

Furthermore, the enrollment process for the special loan program is very complicated and does not address the problem of liquidity, Lee said.

Other business operators have also said that the government’s plan, which will subsidize training and transformation efforts in the travel sector, does not address the immediate problems.

According to the Ministry of Transportation and Communications, the funds will be used to encourage tourism stakeholders to take advantage of the slow period to improve their quality of service and marketing skills and will pay trainees an hourly stipend of NT$158, up to a maximum of 120 hours.

On Wednesday, the major travel agencies in Taiwan announced a suspension of all tours through the end of April, citing a slowdown of the global travel industry due to the escalation of the COVID-19 pandemic.

On the Taiwan stock market, shares of Lion Travel and Phoenix Tours plunged to end at NT$51.2 and NT$23.15, respectively.

It was Lion Travel’s worst performance on the stock market since it went public in 2013, and Phoenix Tours’ most dismal since 2007.

Meanwhile, Cola Tours said it was suspending tours to countries seriously affected by the disease, including Japan, the United States, Canada, Thailand and Indonesia.