6
AUG
Disruptions faced by the domestic supply chain as Victoria state goes into a 6-week lockdown.
With the Victoria outbreak threatening to spill into other states, border and movement restrictions have since been reintroduced across the country in varying degrees.
  • The State of Victoria reported 8 COVID-19 deaths in the last 24 hours, just days after announcing its deadliest day of the pandemic with 15 deaths. This comes after state capital Melbourne began the first day of a 6-week lockdown, as authorities battle against a second wave of coronavirus infections.
  • Forecast national peak unemployment had been revised upwards to about 10% due to Victoria's reimposition of restrictions. However, effective unemployment is estimated to be at 14% when workers on Australia’s wage subsidy scheme is taken into account.
  • Singapore and Australia signed a digital economy agreement (SADEA), which will facilitate digitalisation of trade processes and make it easier and more cost-effective for local companies to engage in cross-border business activities between both countries. This includes the digitalisation of trade administration documentation for efficient cargo clearance.
    • Impact on Food Supply Chain
  • Victoria has a huge food and beverage industry footprint, whereby one-third of total industry turnover and employment is accounted for within the state. With Stage 4 lockdown in place, several restrictions have been placed on the meat, seafood and warehouse divisions, including whether they can remain operational and the number of workers that are allowed. Where operational, workers are required to obtain permits.
  • The outbreak has also led to a 8pm to 5am curfew, as well as a recent 48-hour shut down of a key air freight terminal in Melbourne. The domestic supply chain is experiencing shortages, aggravated by elements of panic buying.
  • The Australian Beverage Council has commissioned KPMG to develop a drinks industry recovery blueprint, detailing 4 key policy recommendations for state and federal governments to consider to support the industry and more broadly, the nation’s economy and its recovery.
    • 24
    July
    The nation sees a surge in COVID-19 cases and deaths, along with a growing budget deficit and unemployment rates.
    Australia reported its highest daily number of COVID-19 deaths in 3 months, as new infections continue to climb in its two most populous states - New South Wales and Victoria
  • Border and movement restrictions have been reintroduced, although in varying degrees across the different states and territories.
  • An elimination strategy similar to New Zealand’s is being contemplated. However, the Federal Government is concerned that elimination would be too costly and lead to extra job losses. It could also provide a false sense of security and encourage people to be more complacent about the ongoing risks of an outbreak.
  • Following 28 years of unbroken economic growth, Australia is set to experience 2 consecutive years of contraction for the first time since the 1930s. The economy is believed to have shrunk by 0.25% in 2019-20, and will contact a further 2.5% in 2020-21. The budget swung into a massive deficit of A$86.8 billion in the year-ended June 2020 and the shortfall is expected to climb to A$184.5billion in 2020-21.
  • The pandemic has sent unemployment to 7.4% - the highest in over two decades - and is expected to peak at 9.25% by the year end.
  • The JobKeeper scheme was rolled out to support struggling businesses, by providing wage subsidies (A$1,500 a fortnight) to help keep staff employed. Intended to end by September 2020, this scheme has since been extended till 28 March 2021 - but the subsidy will be reduced to A$1,200 a fortnight in September 2020 and A$1,000 a fortnight in January 2021. Likewise, extra welfare benefits for the unemployed will also be continued but at a reduced amount.
  • The Federal Government plans to increase stimulus spending on the two income support programmes to around A$86 billion.
    • 17
    JUN
    While the nation’s borders will remain closed until 2021, long-term visitors and students may be allowed in sooner.
    Australia’s Trade Minister announced that the nation is unlikely to re-open its border to tourists until 2021.
  • However, entry rules for students and other long-term visitors may sooner be relaxed while still adhering to the strict 14-day quarantine rule.
  • International education (i.e. foreign students receiving their education in Australia) is a significant export earner for the country.
  • With international travel prohibited in the foreseeable future, the Government has urged Australians to look to local travel to help boost domestic tourism.
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