Bars and restaurants feel the coronavirus pinch with alarming decline in sales

Catering establishments and bars have reported a “significant and alarming” drop in sales, according to the Association of Catering Establishments (ACE) in the wake of fears over coronavirus contagion.

Apart from the immediate decline in sales, ACE reported a number of booking cancellations for events such as parties, which gained stronger momentum after new precautionary measures on the Covid-19 influenza virus were announced on Tuesday afternoon. 

 “The decrease in sales and bookings is leading to cash flow issues for restaurants and bars amongst others. ACE feels that the government should intervene by ensuring that it continuous to encourage measures that do not lead to panic but to also intervene by assisting catering establishments,” ACE spokesperson Reuben Buttigieg said.

Buttigieg said ACE wants banks to give its members a moratorium on loans, as well as government to give a moratorium on agreements of tax and social security payments, as well as accept delays in VAT, tax and social security payments without penalties.

“This will assist in the cash flow until the situation goes back to normal and it will avoid catering establishment having to take other drastic measures such as reducing hours for employees or worst still having to ask them to delay salary payments,” Buttigieg said.

“Furthermore it seems some employees did not report to work. ACE believes that no reporting to work without a sick certificate should be subject to disciplinary measures. ACE is also disappointed about the fact that so far no compensation fund was set up by the government to compensate employees who are subject to quarantine. This is affecting also the operations of establishment particularly the smaller ones with a small number of employees.”

Buttigieg said the mitigatory measures would not solve the problems being faced by businesses hit by the coronavirus panic, but give entrepreneurs peace of mind to engage in business development rather than mitigating measures. “Members of the association are being advised regularly to abide by the recommendations of the health authorities. Members are being kept regularly updated on developments as reported by authorities. Members have also access to advice on measures that can be taken to ensure even healthier establishment environment.”

MHRA calls for loans repayment relief

MHRA has over the past days been calling upon the main banks and meeting them to extend a moratorium on loan repayments to the Tourism and Hospitality industry.

 “Towards this end BOV and HSBC have in principle agreed to provide general support and consideration toward any areas which main be impacted by such exceptional adverse circumstances. Given that specific clients may require different responses, the banks have pledged to work constructively with each to agree on any appropriate support arrangements.

 “Furthermore, a meeting was held with the Minister of Tourism and Consumer Protection, Julia Farrugia Portelli in the presence of ministry and MTA officials. The severity of this crisis was made very clear to the minister and discussed avenues on how to best mitigate the negative effects of the global outbreak of the COVID-19 virus on the local tourism industry.”