The head of the Tourism Industry Association of Canada expresses concerns over the financial struggles faced by businesses in the industry. With a lack of international visitors and mounting debt, many operators are at risk of closing within the next three years. In a survey conducted among tourism operators, 45% stated that they were likely to shut down unless the government intervenes to adjust their loan conditions. Beth Potter, CEO of the trade organization, highlighted the wide range of businesses affected, including campgrounds, hotels, amusement parks, and outdoor adventure establishments. Non-profit organizations that organize festival events are particularly challenged in repaying their loans.
Many businesses revealed that they are unable to make the debt payments that are due within the next two years. These loans include those obtained through federal pandemic relief programs such as the Canada Emergency Business Account (CEBA), the Regional Relief and Recovery Fund, and the Highly Affected Sectors Credit Availability Program. The Tourism Industry Association is urging the government to extend the zero-interest repayment deadline for CEBA loans to December 31, 2025, as well as increase the forgivable portion of fully repaid loans to 50% and extend the qualification deadline for forgiveness to the end of 2024.
According to the latest figures from Statistics Canada, the number of visitors to Canada and returning residents in March 2023 was only 77% of the levels seen in March 2019. This decline in international tourists has contributed to the challenges faced in repaying debt. Business travel, in particular, remains significantly lower than pre-pandemic levels, affecting conferences, trade shows, and transient business travel.
Labor shortages have also added to the difficulties faced by business owners. Skilled positions are harder to fill, and there are limitations in marketing, customer service, and team management. Furthermore, the exit of many baby boomers from the workforce has resulted in a loss of industry leadership. Despite the travel industry rebounding more quickly in the United States, business and international travel there also remain below 2019 levels.
The government’s CEBA program provided interest-free loans of up to $60,000 to over 898,000 small businesses and not-for-profits, totaling $49.2 billion. However, the government states that all repayment deadlines are now final and cannot be changed.
The survey conducted by Nanos included responses from 149 financial controllers and accountants of businesses in the tourism sector between April 28 and May 12.
Denial of responsibility! VigourTimes is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
