D-day for economic response package
This is going to hurt.
That was the message from Prime Minister Jacinda Ardern yesterday as she began the most crucial week of her premiership by effectively banning all gatherings of more than 500 people because of fears around coronavirus, a measure that will hit an economy already bruised from the sweeping travel restrictions imposed over the weekend.
And it will hurt a lot. Ardern said early advice from Treasury indicated the impact of the Covid-19 crisis could well exceed that of the 2008 global financial crisis, which saw the economy shrink by 3.3 per cent over five continuous quarters.
‘‘The difference is, of course, that there is no existing playbook for the economic response here,’’ Ardern said.
Already, Air New Zealand is looking at cutting its staff by up to 3700, while Retail NZ says up to 10,000 jobs are at risk.
That grim news sets the stage for the economic package Finance Minister Grant Robertson will unveil today. This package will be larger than any other introduced by this Government, according to Ardern, indicating a price tag in the double-digit billions.
The Government hopes this fiscal stimulus can join with the monetary stimulus offered by the Reserve Bank yesterday, which cut the Official Cash Rate by 75 basis points to just 0.25 per cent – the lowest it has ever been.
Events cancelled
The Government’s advice that all events of more than 500 people be cancelled saw two events called off immediately – the Auckland Writers Festival and Central Districts Field Days.
Others are likely to follow as Ardern did not put a time limit on such advice, but noted there were 107 events planned for the next month with more than 1000 people expected.
Wellington’s Homegrown festival has been postponed indefinitely.
Schools and universities are not hit but will get further advice from the Government soon on how to lower the risk of the virus spreading.
More guidance on smaller gatherings such as weddings or funerals will be delivered later in the week.
Ardern asked Kiwis yesterday to practise as much ‘‘social distancing’’ as possible – putting off visits to elderly relatives, forgoing handshakes or hugs, and staying home from work if unwell.
‘‘It’s all about making sure that you maintain social distancing in whatever environment you are in. That has to be our new normal.’’
This is part of a strategy to ‘‘flatten the curve’’ of Covid-19’s spread. The Government expects more cases over coming weeks, but wants to keep the numbers low so the health system is able to cope.
Zero tolerance
The Prime Minister made clear yesterday that the Government would take an extremely dim view of any tourists or Kiwis who failed to ‘‘self-isolate’’ for the required two weeks after entering New Zealand.
Cabinet authorised Customs to detain and deport temporary visa holders who ignored the order.
‘‘If you come here and have no intention of following our requests to selfisolate, frankly, you are not welcome and should leave before you are deported.
There are now roughly 170,000 confirmed cases of coronavirus worldwide and over 6500 deaths.