COVID-19 and the world of work

ILO statement for the July edition of the MPTF Informal Economies Recovery Project Monthly Newsletter

By Mr Matin Karimli, Director, ILO Office for Pacific Island Countries

Statement | 22 July 2021
Matin Karimli
My arrival in Fiji in early February 2020 to take up my post coincided with the outbreak of the global pandemic reaching the Pacific.

For all Pacific countries, the tourism industry, that provided a life-line to many businesses including those in the informal sector, was the first to go. As early as 30th March 2020, the Fiji Hotel and Tourism Association (FHTA) announced that 279 members had closed due to zero booking for next few months, 30 were operating in reduced scale and about 20,000 workers had been sent home.

A year and seven months on, Fiji is in the midst of its second wave COVID-19 emergency. Many businesses are straining under the prolonged stress of closure, reduced operating hours and significantly fewer customers. A recent survey conducted by the restaurant and café business community highlighted a massive revenue drop of 75% - 99% among the majority of members; while 25% of members indicated that they were considering closing down immediately.

On 10th June 2021 I had the privilege of joining the consultation with Micro, Small and Medium Enterprises (MSME). Organized by ILO, MSME Fiji (Government), Fiji Commerce & Employers Federation (FCEF) and UNDP. This also included representatives from the informal sector, that have been hard hit and without support. While the representatives presented many challenges -and solutions - it was very clear that the mounting operational costs against limited or no income was leading many to close down places of business and employment.

On 25th June 2021, I wrote to Fiji’s Permanent Secretary of the Ministry of Commerce, Trade, Tourism and Transport (MCTTT) attaching a summary of key MSME challenges and proposed solutions, andrequesting to consider them for the national budget.

The recently announced national budget 2021-22 by the Fijian Government provides a ray of hope for MSMEs, including those in the informal sector. Announced on 16th July 2021, some targeted benefits for MSME’s in the national budget include:
(a) FJD $200 million allocation for concessional loans targeting 20,000 businesses.
(b) FJD $8 million allocated for interest on concessional loans for MSME’s for a period of two years.
(c) FJD $5 million allocated for guarantees against MSME loans.
(d) FJD $7 million allocated to support electricity costs targeting 18,700 businesses.
(e) FJD $250,000 allocated for business training and advisory services, with one of the service providers being the Fiji Commerce & Employers Federation (FCEF).
(f) FJD $1.2 million allocated to support e-commerce.
(g) FJD $2.6 million allocated for stall fees for market vendors in municipal markets.
(h) FJD $2.5 million allocated for base fees for taxi, mini bus and carrier operators.

This is the second national budget of government, in response to COVD-19. Compared to the last budget, we can see a more targeted focus on supporting and sustaining MSMEs.

The ILO continues to align its technical assistance to add value to government’s efforts in supporting MSMEs. Soon, through the UN Joint Informal Economies Recovery Project, the ILO will launch on-line business training and advisory services for the hard-hit creative industries enterprises.

The six-week on-line programme also assists beneficiaries to access government support highlighted in the budget. This will primarily be done through capacity building, including provisions of COVID safe business operations and helping beneficiaries develop business plans aligned with government requirements.

I hope that you will enjoy the great stories in this issue of the Informal Economies Recovery Project e-Newsletter, and please feel free to engage with us across our social media platforms on Facebook and Twitter.

Follow Matin Karimli, Director, ILO Office for Pacific Island Countries on twitter here: @MatinKarimli