EEMA’s Recommendation to the Government Given the Impact of Coronavirus on the Experiential Industry
by EVENTFAQS Bureau Industry Watch | March 17, 2020 | Press Release
The outbreak of the Corona Virus has impacted the world of live events and experiential marketing resulting in the cancellation of multiple global events. No industry resides more in the physical realm than hospitality, experiential, tourism, events, sports, and experiences. The impact of Covid19 on the events and experiential industry would be to the tune of Rs 3000 Cr for the first two months, at a minimum, as projected in a survey of 100 MSMEs in the sector. This is in part due to the cancellations of existing projects and contracts.
The pandemic has put businesses on pause, forcing an unprecedented loss, impacting the livelihood of millions employed, inability to pay taxes, inability to pay banks and financial institutions to honor commitments and challenging time for vendors and supply chain.
EEMA has requested the Government of India to consider the following steps to alleviate the present situation.
- To cover the cost of salaries/daily wages etc. for those infected by COVID 19 and unable to return to work.
- The moratorium of payback on loans, interest for a period of 9-12 months.
- Release with immediate effect all Tax refunds that are due including income tax and TDS.
- Collateral free line of credit to be used for employees’ salaries and statutory dues.
Industry Reconstruction Measures
- Pay all dues to companies who have executed work orders in this segment for the Government of India, the public sector and State Governments.
- Zero or minimal-interest loans to be made available by the department of MSME for the financial year 2020.
- Government-initiated projects should replace the need of Bank guarantees with Corporate guarantees.
- Loans to be provided for loss-making companies against future contractual work.
- Instruct insurance companies to insure future events and activities against Covid 19 or similar medical/biological disasters in addition to existing natural disasters.
- To cover the cost of salaries/daily wages of employees laid off for a period of 90 days at least.
- Reduction of GST on entertainment and cultural events to 12% and the arts & entertainment segment may be covered.
Here are some examples of what governments across the globe are doing to support SMEs / these industries during this pandemic:
Initiatives by Dubai Government
The package developed by the Dubai Government includes 15 initiatives focused on the commercial sector, retail, external trade, tourism, and the energy sector. It is expected to reduce the cost of doing business and simplify business procedures, especially in the tourism, retail, external trade, logistics, and services sectors. The stimulus measures that will be introduced with immediate effect will be valid for the next three months.
Initiatives by the UK Government
£40 million of new funding to enable further rapid research into COVID-19 and increase the capacity and capability of diagnostic testing and surveillance facilitated by Public Health England. A new temporary Coronavirus Business Interruption Loan Scheme, delivered by the British Business Bank, will launch in a matter of weeks to support businesses to access bank lending and overdrafts. The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £1.2 million in value.
Initiatives by the German Government
The German Government will provide a financial lifeline to creative artists, private cultural institutions and event companies hit by the coronavirus outbreak.
Read more on EEMA's Recommendation to FICCI
“The event and experiential industry and the cultural sector has been adversely affected by the onset of covid 19. We need all the help to prevent job attrition and closure of SMEs. We look forward to representing the voice of the industry through this dialogue with the government,” said Sanjoy Roy, President, EEMA and Managing Director, Teamwork Arts.
“The event industry has willingly accepted the government’s restrictions and canceled all its work to ensure that the community and country are free of risk. As EEMA we will continue to work with both the central government and the state governments in order to create conditions that reduce the adverse impact on the workforce and businesses.
We all believe that the pandemic is temporary and the stock markets will return, the live events and experience economy will return to boom time. The truth is that the harsh realities of today will teach us how to function with frugal resources. Our industry could easily press the RESET button" said Sabbas Joseph, Director, Wizcraft International.
Click here to read about General Coronavirus Advisory by EEMA
During this challenging period, it is recommended that owners and management of event companies use the time to upskill their teams and help them develop their hidden talents, other faculties, etc. EEMA and some of the leaders of the industry will conduct online and offline education and mentoring programs so that the employees currently working for their companies and the professionals registered with EEMA could both avail of the program and benefit from the learning and get themselves ready for the oncoming economic revival. It is extremely important for management and employees to be sensitive to each other in this forced business and livelihood threatening scenario.
Know more about- Industry Experts Recommend on How to Get Through the Slump Caused by Coronavirus Outbreak
Recommendations to FICCI include - To cover the cost of salaries/ daily wages etc. for those infected by COVID 19 & unable to return to work; Moratorium of payback on loans, interest and more.