The global COVID threat has hit Palau “like an economic typhoon”, representatives from the Palau Media Council have said, even though the virus has yet to reach the island.
With the lockdown and the worldwide halt in travel, the Republic of Palau, with its largely tourist-based economy, is faced with a predicted 25% drop in GPD over the next two years, according to projections made by the Ministry of Finance. The Ministry estimates that 27% of the workforce in Palau will be jobless due to business-closures and layoffs, over 2,000 of which will be foreign workers operating in the private sector.
This week, Island Times had the chance to interview several workers from numerous corners of the island, and to hear what they had to say about maintaining their businesses in the midst of this “economic typhoon”.
Elilai Spa sits on the premises of Palau Pacific Resort, Koror’s 5-star hotel which has temporarily closed its doors to the public, but is operated by Mandara Spa of Bali. The spa villas remain open to customers.
The masseuses, who all come from Bali, continue to perform their normal treatments, although with reduced hours.
“The decline in business for us started mid-March when borders closed,” said Charlotte, Senior Project Manager for the spa. “Elilai Spa went to achieving an average of 10-12% of pre-COVID-19 revenue.”
Once heavily reliant on the guests staying at PPR, the spa now generally receives local residents of Palau, committed customers, and members of the PPR Recreational Club.
“These members have always been part of our customer base, and during this unique time we are relying on their support more than ever,” Charlotte said.
The spa has been using a combination of retail and treatment promotions to entice customers to return, offering a 50% discount on the normal rates.
“We were quick to reduce expenses wherever we could,” Charlotte said. “Elilai Spa is part of Mandara Spa, which is also part of One Spa World. In these difficult circumstances, being part of a big group definitely helps to weather this storm.”
Very few in Koror are unfamiliar with Sun’s Flower Shop, “the only florist in town”. Mrs. Sandra Pierantozzi, who, in addition to being a former Vice President of Palau, operates several businesses including Sun’s, says that her flower shop is also hurting from the pandemic. However, unlike many other businesses, which suffer from a shrinking customer base, Sun’s is affected by rising prices from some suppliers and the closures of others.
“Many of our products come from the Philippines, but now we’re hardly getting any from the Philippines,” she said. “We’ve managed to survive because we diversify our products.
For instance, we sell jewelry as well as flowers. We’re also luckier than most because so many of our customers are local. Sometimes tourists come looking for flowers, but most of our customers live right in Palau.” Mrs. Pierantozzi thinks this has less to do with the local ownership and a lot to do with the nature of what they’re selling. “Funerals are an important occasion for flowers in Palau. But also holidays like Mother’s Day. Everyone has a mother. And here, sometimes more than one.”
“And Filipinos,” she added, “always love to come in and buy flowers for their wives, girlfriends, their significant others.”
Mrs. Pierantozzi said that, in light of the financial strain, the company has had to think of additional ways to draw customers in. Sometimes this means crafty advertising, but more often it means going the extra mile.
“We have to give that extra something. Maybe an extra balloon. Other times it’s a personal touch. Although I don’t often get the opportunity, I love being able to deliver flowers in person. I’ve always loved flowers because they make people happy. Lockdown or no, people still need to feel that.”
Other businesses are harder hit. Palau Escape, the dive operation owned by legendary diver Francis Toribiong, was forced to close its shop not long after lockdown began. As a smaller dive operation which specializes in personalized tours, Palau Escape is almost completely reliant on tourist clientele. So when the borders closed, the customers and the income stopped coming in.
“We ran out of money within the first month,” said Joseph Gugliemelli, General Manager. “The business was totally zeroed out.”
Not long after, Joseph and other members of Palau Escape applied for the PVA reemployment program. Joseph currently works at the Belau National Museum, developing land-based eco-tourism. “Doing this opened doors in my mind,” he said, about ways to improve the services offered by his company.
“Before this, we mainly stuck to diving and snorkeling. But Palau has a lot more to offer. Instead of looking at the dive industry, we should look at the tourism industry. Many families who come here are divided because half of them dive and the other half don’t.”
Among potential ideas for tourism programs are bird-watching tours. “There’s actually a market in bird-watching,” he said. “Palau has a lot of rare birds, indigenous to the islands.”
Each state, he explained, has something new to offer. “There’s hiking, camping, waterfalls, historical sites. If the states get involved, and the tour companies, that’s beneficial for the companies, the states, the visitors, and the economy.”
“This lockdown gives us a chance to reboot the island for tourism,” he said. “Now that we have the time, we can develop things, so that when Palau opens up, we’re ready for anything.”