Diversity key to economic recovery
The region is in a good position to ride out the impact of the coronavirus lockdown, the chief executive of South Canterbury’s economic development agency says.
As the country approaches week three of the lockdown, Nigel Davenport, of Aoraki Development, said South Canterbury’s diverse industry sector base ‘‘should be able to put us in good stead’’ for the months ahead. ‘‘We are not a one-trick pony, we have got a really good foundation.’’
Davenport said another positive was that some of the region’s largest employers were considered essential services.
This included sectors such as health, food processing, transport and logistics, and the primary sector in general.
Aoraki Development has been inundated with calls from businesses asking for advice and assistance during the lockdown.
‘‘There has been a variety of questions but the biggest thing is ensuring our businesses get the right support right now,’’ Davenport said. ‘‘That means going to your banker, your accountant and your lawyers, but also looking at what assistance is available to you during this period.’’
Most companies that had approached the agency wanted to know how to access the Government’s wage subsidy, Davenport said. ‘‘We are still only a few days into the lockdown, and our priority is to make sure businesses can come out the other side able to recover and rebuild,’’ he said.
‘‘Our diverse industry sector base should be able to put us in good stead. But by the same token, there might be businesses that struggle to come out the other side of this, particularly over the next few months.’’ At about 2 per cent, South Canterbury’s unemployment rate is among the lowest in the country and Davenport said it was still too soon to tell how much unemployment would increase in the weeks and months post-lockdown. ‘‘It is very early days and I have heard nationally there being talk of it reaching double digits. But we have got to get through the early stages of it first. ‘‘When you look at the Canterbury earthquakes, it took years for the region’s economy to truly recover. It will be like that except bigger for this, because it is such an unprecedented event,’’ Davenport said. ‘‘More to the point, it is an international event. It affects everyone in some form.’’ A structured approach was needed so that when the business community was able to ‘‘re-ignite itself, it can do so’’, he said.
While he was pleased central government had come to the party with assistance, in particular the wage subsidy package, Davenport said local government would also need to step up. ‘‘Every region will have different pressure points. It is up to organisations such as our own to connect with the local economy.
‘‘But you will see the public and private sector collaborating more often,’’ Davenport said.
Looking out for one another was also important, he said.
‘‘You have already seen it with some landlords offering a rent holiday for an amount of time, for example.’’ The post-Covid environment would also change the nature of work, Davenport said.
‘‘I don’t want to sugarcoat it – it will be very tough in some aspects. What we will see is something of a reset.’’ In particular, industries which rely heavily on a migrant workforce, might have to look elsewhere. ‘‘The nature of our workforce will almost certainly change as we come out the other side of this,’’ he said.