A RESTRICTION on new applications and a slowdown in Significant Investor Visa (SIV) processing times is leading to a desperate shortage of funding for venture capital and emerging companies to survive the post-COVID-19 recession, according to Atlas Advisors Australia.

A large number of SIV applications under the Business Innovation and Investment Program (BIIP) remain frozen in the final stages of approval because they are not being prioritised.

Executive chairman of Atlas Advisors Australia, Guy Hedley said this added to a general slowdown in processing times and a downward trend in BIIP approvals that was impeding venture capital funds and emerging companies from obtaining urgently needed capital.

Mr Hedley said there were grave concerns BIIP applications could be stalled beyond July, creating uncertainty and further funding constraints for organisations that were already on the brink.

“These are startups and emerging companies that have the prospects of becoming global leaders in health, technology, agribusiness and manufacturing but are now on the verge of collapse,” Mr Hedley said.

“The Australian economy risks losing billions of dollars, jobs and future innovation if this occurs.”

Mr Hedley said BIIP applications should be urgently reopened and the Australian Government’s review of the program should be sped up to unlock urgent funds to support post-pandemic growth.

“The current cap on BIIP applications means Australia’s economy has closed itself off from millions of dollars that could assist our recovery,” he said.

Significantly, this could also offset the serious ramifications of an expected 85 percent fall in migration in the 2020-21 financial year compared to 2019-20.

“Priority should be given to higher net worth migrant applicants to Significant Investor Visa, Investor Visa and Premium Investor Visa programs that bring substantially greater investment and longer-term benefits to the Australian economy.”

Atlas Advisors statistics showed: 

• It took up to six months to process applications in 2015. Today it takes between up to two years.
• The number of primary visas granted has declined to 98 in the six months between July to December 2019 from 191 in the previous corresponding period of July, 2018 to June, 2019.
• In 2015, when applications were processed at their fastest, there were 879 approved.

About Atlas Advisors Australia 

Atlas Advisors Australia is a funds manager and investment advisory business, operating between China and Australia offering a wide range of financial services and wealth management solutions. With operations in Sydney and Melbourne in Australia and Shanghai in China, Atlas is able to support investors in all China and Australia locations.

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SMALL BUSINESSES emerging from hibernation and ready to make the most of easing COVID restrictions can find the information they need on ASBFEO’s My Business Health web portal.

The Australian Small Business and Family Enterprise Ombudsman Kate Carnell said the My Business Health web portal now features important information for small business owners ready to re-open or ramp up their operations.

“There’s never been a tougher time to be in business and it is understandable if some small business owners are feeling overwhelmed right now,” Ms Carnell said. 

“The pandemic has changed so much in such a short amount of time, small business owners may be finding it difficult to stay on top of their obligations.

“My Business Health is a one-stop-shop for state-by-state information about restrictions and COVID-Safe Plans.

“It includes links to relevant posters and signage for your workplace along with safe workplace checklists and grants available to re-opening small businesses.

“There’s also information on free apps available such as GuestTrack, for those small businesses that need to collect and store customer and visitor contact details in the event of a localised COVID outbreak.

“My Business Health also links through to leading mental health organisations’ resources, such as Beyond Blue’s dedicated coronavirus mental health support service and Ahead for Business," Ms Carnell said.

“As small business owners work around the clock to get back on their feet, they may not realise the toll it’s taking on their mental health.

“Over the coming weeks, it’s important to take time to be kind to yourself – your business depends on you being healthy. Help is available if you need it. Visiting My Business Health is a good place to start.”    

Beyond Blue’s Coronavirus Mental Wellbeing Support Service is now live at coronavirus.beyondblue.org.au

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THE House of Representatives Standing Committee on Economics will scrutinise the financial advice sector at a hearing by videoconference on June 30, 2020, as part of its ongoing review of the four major banks and other financial institutions.

The chair of the committee, Tim Wilson MP, said, "These hearings are an important mechanism for the Parliament to publicly scrutinise and hold Australia’s financial advice sector to account."

"Many Australians turn to financial advisers and mortgage brokers to help them navigate important financial decisions, such as finding the right mortgage or determining how to best invest in and secure their retirement. It is essential that Australians can trust that financial advisers and mortgage brokers are always acting in their client’s best interests, rather than the interests of the adviser or any third parties."

"Given the widespread misconduct in the financial advice sector identified by the Hayne Royal Commission, it is important that financial advisers, mortgage brokers, and those in the industry are held accountable to ensure that they are making the crucial improvements needed to restore trust in the sector."

Public hearing details

The hearings will be broadcast live at aph.gov.au/live.

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THE LATEST Australian Bureau of Statistics (ABS) Overseas Arrivals and Departures results reveal the month Australia’s tourism industry officially flatlined, with an extraordinary 99.7 percent decrease on April 2019, the largest decrease on record.
 
“This is the beginning of what will be a deep and protracted downturn for our export tourism industry and there is absolutely no end in sight,” Australian Tourism Export Council managing director Peter Shelley said of the figures.
 
“COVID has simply decimated our $45 billion export tourism industry which now faces a very difficult future with many businesses unlikely to last the distance while there is so much uncertainty surrounding the reopening of international borders.
 
“While JobKeeper is a critical part of the business survival package in supporting the retention of valuable staff, the commercial challenge of meeting the costs of fixed overheads over 12 months without revenue will be a bridge too far for many.
 
“It’s devastating to see so many small businesses effectively cut down overnight after years of hard yards carving out a profitable business, with many choosing to walk away because the mountain is simply too big to climb for a second time," Mr Shelley said.
 
“While there is some relief for businesses who can connect to domestic tourists, for many tourism businesses who have built their strength on international visitation, the prognosis is dire.”
 
Mr Shelley said ATEC’s survey of export tourism businesses across Australia suggests half of these tourism businesses will fail if borders are not opened in the coming six months.
 
“Domestic tourism simply won't be enough to plug the $45 billion hole left by our international visitors," he said.
 
“While most Australian’s will look to holiday at home for the foreseeable future, it can't be presumed that those people who had international travel plans for 2020 will reinvest that budget toward a domestic trip.
 
“Consumer confidence, employment insecurity and budget priorities will all be major factors in the spending choices of Australians and travel is likely to be one of the discretionary expenses people choose to do without.
 
“These issues, coupled with the business costs of social distancing, will put many thousands of tourism businesses under enormous strain and many will simply choose not to reopen or will quickly fail.
 
“We can see from the ABS data that Australia’s export tourism industry has been a strong and vibrant contributor to the national economy over many years, bringing wealth to regional communities and providing a significant number of jobs - and all of this benefit has now been destroyed.
 
“The Government’s JobKeeper program has helped to support thousands of tourism businesses to hold on.  We know most of them can remain viable once business returns, but in the meantime they will continue to need support.”

www.tourismdrivesgrowth.com.au

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