York Region responds to economic fallout from Severe Acute Respiratory Syndrome (SARS)

NEWMARKET – In light of the recent World Health Organization travel advisory warning travellers against coming to Toronto because of the SARS outbreak, York Region is working with the private sector and tourism partners on a plan of action to respond to the economic fallout in Ontario. York Regional Council is also ready to respond to the local economic impacts.

"York Regional Council has already asked staff to look at economic issues regarding SARS and Council is prepared to review any additional measures that may be necessary to continue to ensure the economic health and prosperity of our Region," said Regional Chair and CEO Bill Fisch.

Although it is early to speculate on the tourism dollar losses in the Region, research is currently being compiled with various tourism sectors to determine the economic impacts. Attached is a preliminary status report. In the mean time, York Region Tourism is proceeding with its advertising initiatives for the year. They include:

• Full page ad in Ontario Tourism’s quarterly events publication (150,000 circulation)

• Full page ad in Ontario Tourism’s summer newspaper insert (1.4 million circulation)
• York Region listing in Ontario Tourism’s Web site and Reference Guide
• Quarter page ad in the April edition of the Canadian Automobile Association (CAA) Journey magazine (600,000 circulation)

• Two-page spread in CAA’s Leisureways magazine (600,000 circulation)
• Ad in the May edition of What's Up Kids publication (200,000 circulation)
• Back cover ad in the April edition of City Parent- Kids Newspaper (100,000 circulation)
• Four-page insert entitled The Great York Region Getaway in Ottawa, Buffalo and Rochester newspapers in May and June (40,000 circulation)
• One-third page ad in May edition of Attractions Ontario (1.5 million circulation)
• Marketplace ad in the May edition of The Toronto Star’s What's On this Summer insert (750,000 circulation)

In 2001, York Region welcomed 2.1 million visitors who spent $126 million. Americans accounted for 125,000 of these visitors, spending $64.3 million, and 46,000 visitors, spending $25.4 million came from overseas.

See attached Fact Sheet on preliminary local economic impact of SARS.

Fact Sheet

Currently there is not enough information for anyone to come up with an accurate estimate on the economic impact of the Severe Acute Respiratory Syndrome (SARS) outbreak. The following is a preliminary status report on the local impact.

Hospitality and Tourism Sector

• SARS has created considerable short-term uncertainty in the tourism industry. It is too early to speculate on the business revenue losses, employment layoffs and airline financial woes, but research is currently being compiled with various tourism sectors to determine the economic impacts.

• Hotels in York Region have provided the most current information with five hotels reporting direct losses of over $1.6 million in leisure, business, group and convention travel cancellations. Some hotels are experiencing staff layoffs.

• The retail, attraction and restaurant industry losses are more difficult to track.

• Retail Council of Canada surveyed retailers in the "M" postal code area (i.e. Toronto) on April 15^th and 16^th and reported no significant impact related to SARS. Retailers in the "L" postal code area (i.e. York Region) were not surveyed. The Retail Council plans to do another survey next week. There were verbal reports indicating that the impact is felt more strongly in the tourism and Asian communities.

• Anecdotal information has been received from First Markham Place and other Chinese businesses that SARS has had negative impacts in the retail and dining sectors.

• York Region’s Tourism Promotion Co-ordinator is sitting on a Minister of Tourism and Recreation Advisory Group representing the Economic Developers Council of Ontario to determine an action plan.

• Markham-Richmond Hill Chinese Business Association reported a drop in Chinese business in the area of about 70% to 80%. The Association is working with a coalition of Chinese GTA Businesses (60-70 partners) who are tracking the economic impacts and will be reporting back to all three levels of government with recommendations to improve the current situation. Initially businesses were experiencing an 80% drop in the early days of the SARS outbreak then slowly began to recuperate. However, the recent negative media coverage has caused another surge.

• Mayors of Toronto, Markham, Richmond Hill and Mississauga have been invited to a Summit with six Chinese Business Associations on April 28^th to deal with the economic impact of SARS. The Summit is organized by a community group called Scadding Court Community Centre.

• Ontario Chamber of Commerce is doing a survey of Ontario Businesses and results are expected to be available at the end of April.

• Export Development Canada estimates that if SARS continues, Canadian exports could be much smaller than the expected 3% and Asian trade could be affected by 1%.

• Bank of Canada reported yesterday that SARS may pose uncertainties or may even have a negative impact on economic growth, particularly in the second quarter of this year.

• J. P. Morgan Securities estimates that SARS would reduce real gross domestic product growth by an average of 0.1 per cent per month in the months of March, April and May. The annualized growth rate for the second quarter of this year would be cut by 1 to 1.5 percentage points.

• Some analysts say the potential exists for SARS-related supply-chain delays to affect IT projects that involve hardware manufactured or assembled in Asia. This may result in another downdraft for an already challenged IT sector. The global manufacturing chain and the electronics industry in particular are threatened because a lot of production of semiconductors, electronic components, low-level assemblies, and system products come from southern China and Southeast Asia. Many Taiwanese companies are suspending travel to manufacturing plants in China, and Compac, a major manufacturer of laptops for Dell and Hewlitt Packard, has barred employees from those areas.