The leisure entertainment and attractions industry in the Middle East and North Africa region is losing around $6.71 billion (24.64 billion) per month due to disruptions caused by the coronavirus, according to a new report.

The financial impact is so huge that approximately millions of workers in the region are now at risk of losing their employment, the Middle East and North Africa Leisure Attractions Council (MENALAC) warned on Wednesday.

The UAE is home to several theme parks, amusement parks and leisure facilities that attract millions of residents and tourists every year and employ expatriates from around the world. Visitor spending in the country’s theme park sector alone was estimated to expand from $105 million in 2016 to $637 million this year.

Across the region, the spending was forecast to more than double, from $266 million in 2018 to $609 million by 2023. The market was also estimated to grow by 33.77 percent to $404 million this year, from $302 million in 2019.

However, with the coronavirus cases exploding in many countries worldwide, the leisure destinations, along with all public venues and non-essential commercial establishments, were forced to shut down, to prevent the spread of the virus.

“The deadly coronavirus that forced all theme parks, amusement parks and family entertainment centers to a lockdown in the second week of March 2020, is likely to cost millions of jobs and billions of dollars in revenues if the crisis continues for a longer than expected period of time,” the industry body said in a statement.

Silvio Liedtke, vice president of MENALAC, said companies within the industry have found themselves in an “extremely difficult position” and that if the situation doesn’t improve, many businesses will suffer and will be forced to reassess their “business models and viabilities.”

“Most theme park, amusement park and indoor leisure entertainment centre operators are assessing their daily losses and overheads which are piling up to a level that might be difficult to manage if it continues for a longer period,” added Prakash Vivekanand, secretary general of MENALAC.

“Like many other industries, we have never planned for a situation that cashflow from operations cease to zero over a prolonged period of time. We are in an industry that is human resource heavy as we need such trained workforce to ensure the safety and experience of our guests,” he added.

Since the second week of February, he noted, businesses in the industry has seen their revenues dropped by 50 to 80 percent. “When we eventually re-open, it will take us a period of time before normal cashflow from the business resumes,” he pointed out.

For businesses to maintain their workforce and avoid permanent closure, Vivekanand suggested that the government also extends financial support to affected companies in the form of debt relief, repayment waivers, rent waivers, utility rebates and cashflow support to shoulder operating costs, sanitization and upkeep of facilities.

“The governments in the region have already initiated some steps in this direction and we are indeed thankful and grateful to them. Reduction in residence visa costs, VAT holiday until the end of the year [and] import duty rebates will all help our industry to revive and also pass on incentives to the consumer, who is also affected by this crisis,” he added.

Dubai had earlier announced the closure of all theme parks, entertainment and wedding venues, cinemas and night clubs from March 15 until the end of the month as part of precautionary measures to stem the spread of coronavirus.

The Dubai Tourism, in its latest circular, said it has extended indefinitely all the precautionary measures rolled out earlier, so all hotels, restaurants and event venues will now remain closed until further notice.

(Writing by Cleofe Maceda; editing by Seban Scaria)

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