A new report compiled by Gracelyn Cassell of the UWI Open Campus on behalf of the Montserrat Chamber of Commerce states that most respondents have been adversely affected by the island’s shutdown due to COVID-19 and a few are considering permanent closure as a result.
The report was done at the request of the Government of Montserrat which sought to get input for the readiness of the private sector to reopen following six weeks of measures to curtail the spread of the coronavirus disease on island. Premier and Minister of Finance Joseph Farrell said earlier this week, his government was considering a phased approach to reopening the economy, starting May 8.
The report, which was sent to 100 businesses on island, was only completed by 36 owners. As many as 26 businesses (74.3%) reported that they were no longer in operation. Only four (11.4%) were still operating fully on site, while three (8.6%) were operating partially on site and two (5.7%) were operating remotely.
Eighty percent of respondents (28) described the economic impact on their business as high, while the impact was medium for four (11.4%) of them and and low for three (8.6%).
Cash flow challenges were experienced by 28 businesses, while supply chain disruptions made it difficult for 20 businesses to source critical inputs. Twenty businesses also reported that business partners were badly affected and not operating as normal. Thirty operations reported that customers/clients have been affected and that demand was lower than normal.
Very few businesses, six (17.1%) reported having full insurance while six (17.1%) had partial insurance and 23 (65.7%) had no insurance at all.
Access to funds seemed to be a general problem with 24 (68.6%) of the businesses reporting not having access to any for business continuity. While 11 or 31.4% reported having access to some funds, (in one case funds put aside for burial), they all indicated that it was inadequate.
For 75% of the respondents (27), the business was their primary source of income. Only nine (25%) did not consider the business the main source of income.
Eighteen businesses (52.9%) of all respondents had applied to Government for assistance. However only three (15.8%) reported having received responses. The requirement for Business Registration information seems to have deterred some persons who might have wanted to apply.
More than 90% (91.2%) of the respondents (31 businesses) had no Business Continuity Plan while three or (8.8%) had one.
In terms of personal protective equipment (PPE) and products, only six (16.7%) businesses reported having adequate supplies. Thirty businesses (83.3%) of the respondents indicated that they needed to increase their stock of hand sanitizers, gloves, masks and disinfectant wipes.
EMPLOYMENT
Before the lockdowns 122 persons (62%) were in full-time employment, 60 (31%) in part-time employment and 14 (7%) were temporary workers.
Most businesses employed less than 10 members of staff and only 5 had a staff complement exceeding 10. The largest employer among the respondents had 20 full-time employees and two part-time and was engaged in the Retail/Sales sector. The next significant employer with 13 full-time staff and five part-time was in the Hotel/Tourism sector. Only one of the four businesses employing more than 10 employees (12 full-time and 2 part-time) was partially in operation. The other three operations with more than 10 members of staff were not in operation.
In response to the question – Have you had to dismiss or plan to dismiss workers?, 20 respondents (57.1%) said “No” while 15 (42.9%) said “Yes”.
In terms of time needed for business recovery, only 7 (20.6%) felt they would be able to be back in operation in less than a week, 5 (14.7%) needed up to 30 days, while 7 (20.6%) felt they needed 31- 90 days.
Five businesses (14.7%) needed between 91-100 days for recovery and 4 (11.8%) needed more than 181 days. Unfortunately, there were 6 businesses (17.6%) that were considering closing temporarily or permanently.
While 13 operations (37.1%) anticipated increased demand for their services, the majority, 22 (62.9%) did not.
CHALLENGES PRESENTED DURING THE LOCKDOWN
In terms of services offered by Government, many businesses reported that their operations were affected by their inability to license their vehicles.
Several cited the lack of ferry and postal services as having prevented the movement of goods between Montserrat and Antigua and in many cases, this affected acquisition of critical inputs for business.
Similarly, persons needing to export goods were affected by lack of access to freight services.
One respondent explained that the lockdown prevented the clearing of cargo and resulted in storage fees.
A few respondents would have welcomed access to services offered by the Agricultural Department such as purchasing seedlings. However, those services were not available during the lockdown.
While those in the Hotel/Tourism, Food and Beverage sectors understood the need to close the border, the impact on their business was crippling.
CHALLENGES PRESENTED BY LACK OF ACCESS TO PRIVATE SECTOR SERVICES
Respondents felt that not having access to the services offered by tradesmen (many of whom often work alone) affected the progress of projects intended to enhance their business. Those in the Hotel/Tourism sector saw their property deteriorating since cleaners, including pool cleaners, gardeners, and lawn care service providers were also on lockdown.
Many businesses were badly affected by the limited access to financial and banking services. Those in the Retail/Sales sector were unable to access foreign exchange or to transfer funds to acquire goods from overseas.
Several businesses were unable to pay utility bills and insurance premiums because of the lockdown.
Some respondents were unable to deal with repair and maintenance of vehicles since they were unable to access the services of mechanics and shops selling car parts.
While the Port services were available, respondents indicated that there was no access to brokerage services.
Some respondents had paid for work that service providers were unable to deliver as a result of the lockdown.
While there was obvious support for the Agricultural sector during the lockdown, farmers who in the absence of public transportation were unable to get to their plots reported heavy losses. Delayed crop planting and maintenance, decay and praedial larceny were some of the challenges experienced.
GENERAL RECOMMENDATIONS FOR REOPENING
With no new cases of the virus during the last two weeks, there is general support for a phased reopening of the economy following relevant guidelines and policies. There is consensus that our borders should remain closed for
passenger movements except for returning residents, for example students returning for the summer break. The requirement for quarantine on arrival should no doubt be still in place.
While the Hotel/Tourism and other service sector are dependent on visitor arrivals, a resurgence in the number of positive cases is to be avoided. It is suggested that constant monitoring of the pandemic be continued to avoid
getting caught in a second wave.
Evaluating all activities and policies that were introduced during the months of March and April 2020 would be an important first step during this phase. An analysis of what worked well, as well as what did not work well, is necessary for improved handling of the other phases. The input of a wide cross-section of the community should be sought for the exercise.
An effort should be made to consider a variety of communication channels including greater use of text messaging using the support of the two Telecommunications Providers. This would work well to ensure that critical information gets circulated in the community
The Government is to be commended not only for managing the impact of the pandemic on Montserrat but for moving quickly to provide economic stimulus packages for businesses and social care assistance for the vulnerable and persons unable to work during the lockdown.
Based on anecdotal evidence, it would seem that the roll out of the stimulus packages may have overlooked the challenges of the informal business sector. This suggests that timely business counselling during this phase would serve to remedy that oversight as well as assist the business community in general with ideas for re-establishing, improving or reinventing their operations.
Based on the feedback from the business sector, the narrow definition of essential services needs to be revisited. The negative impact of restricting access to banking services, hardware stores, vehicle servicing and parts, and freight services on business continuity has already been highlighted.
As part of this early phase, it is recommended that wider community testing takes place to ascertain if there is still evidence of the virus or if the community has had the benefit of herd immunity. The developments in Senegal with producing an inexpensive testing kit should be monitored since this may be an opportunity for the entire population to be tested.
The Government may want to consider providing initial assistance to the business community which highlighted a severe shortage of personal protective equipment and supplies.
Businesses may want to consider employee temperature monitoring, asking sick employees to remain at home and if these measures are to be followed, Montserrat’s Occupational Health and Safety legislation may need updating.
Restrictions on the movement of sand miners, housekeepers and tradesmen who deliver services either alone or in numbers small enough to facilitate physical distancing, should be removed. This means that cleaners, technicians, mechanics and construction workers who qualify should be issued with passes.
For this to work well, public transportation is required once it is understood that the usual protocols are to be rigorously observed.
To this end, a more intensive community campaign to share best practices for social/physical distancing along with hygiene protocols to be used at home, in the work place and when handling food should be considered.
This exposure would prepare workers to undertake delivery services where restrictions still remain on businesses eg. Restaurants.
Consideration should also be given to making use of shift systems to ensure that physical distancing in the work place is possible.
Government should consider offering e-Government services more aggressively while financial institutions would do well to enhance their online services as well.
Moving from one phase to another would be preceded by joint public and private sector evaluation of the previous phase, the results of which would provide the basis for determining any subsequent action.
Community testing would continue and if locally and globally, there is a decline in the number of positive cases, restrictions on other activities could be removed. However, testing and monitoring will continue through this and all phases.
With each phase, the thrust would be to get as many persons as possible back to work while protecting public health.
Efforts started by the Agricultural Department to encourage subsistence farming should be strengthened. Some level of food security on island has to be ensured since the potential is there for disruptions in the supply chain.
Business counselling should be directed at supporting the adoption of technology for service delivery.
Financial institutions may want to consider programmes to encourage the business community to make more use of online services, merchant accounts and contactless payment systems.
Job opportunities could be provided for the development of ordering and service delivery applications.
Any reopening of schools, churches, etc should be preceded by thorough cleaning and sanitizing of facilities
Local and global developments would determine when border controls should be relaxed.
It remains to be seen if life will get back to what it once was or if Montserrat would have to contend with a new normal. As the country moves into the hurricane season however, all planning and preparation activities would need to address the various threats that the island faces.
