Asia’s hard-pressed cruise industry has secured several financial concessions from the Singapore budget to help it combat the impacts of the coronavirus.
Top among these was a 50% port dues concession on all passenger vessels for an initial six month period.
The Maritime and Port Authority (MPA) said the move is designed to provide relief to vessel owners and operators who have seen a drop in passenger volumes due to the virus outbreak.
The new concession, to be given from 1 March 2020 to 31 August 2020, will be on top of all existing port dues concessions, it added.
All cruise vessels and regional ferries with a port stay of not more than five days, and passenger-carrying harbour craft will qualify for the new concession.
“It is expected to benefit more than 600 cruise vessels, regional ferries and passenger-carrying harbour craft, bringing total savings of over $1m in the six-month period,” the MPA said.
Singapore’s cruise and passenger terminals are also inline to receive property tax rebates as well as be eligible for temporary bridging loans.
Under the budget proposals international cruise or regional ferry terminals such as Marina Bay Cruise Centre, Singapore Cruise Centre and the Tanah Merah Ferry Terminal will qualify for a property tax rebate of 15% payable for the period 1 January 2020 to 31 December 2020.
Cruise terminal operators and service providers with their core business in cruise will also be able to receive additional cash flow support under a new Temporary Bridging Loan Programme (TBLP).
Under the TBLP, eligible enterprises can borrow up to SGD 1m ($720,000), with the interest rate capped at 5% per annum from participating financial institutions.
The Singapore government will provide 80% risk-share on these loans which are due to start in March 2020 and be available for one year.
“The budget has reiterated Singapore’s commitment to fight the economic slowdown and Covid-19 by unveiling wide-ranging and far-reaching measures for Singaporeans and businesses, with targeted support for sectors and individuals that are more affected,” said Ernst & Young Solutions.
Asia's cruise sector has been wiped out almost overnight by the coronavirus outbreak that began in China and has now spread across the region.
Last week Royal Caribbean Cruises said it had cancelled a total of 18 cruises in Southeast Asia due to the virus outbreak.
It said that as a result, these measures will have an estimated impact on its financial performance for 2020 of about $0.65 per share.
Carnival said it expected the virus outbreak to have a multi-million-dollar impact on 2020 earnings if it forces the cruise firm to halt Asian operations through April.
It predicted that it will lower its full-year earnings per share by $0.55 to $0.65, which with 527m shares outstanding equates to between $290m to $343m.
