International border closures are forecast to cost the nation at least $17bn due to the botched vaccine rollout – but the damage bill could climb frighteningly higher.
The cost to the economy incurred by Australia’s isolation from the rest of the world is a whopping $203m a day, according to new modelling by the McKell Institute.
The federal government initially set a target that every Australian would be fully vaccinated against COVID-19 by the end of October, and major airlines such as Qantas based their relaunching of international services around that timeline.
However, supply issues and concerns about the risk of rare blood clotting from the AstraZeneca vaccine in those younger than 50 prompted the government to abandon any immunisation deadline.
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READ NOWMcKell Institute, a progressive research body, has estimated Australia’s international borders have been pushed back 81 days – totalling a cost of $16.44bn – in part two of the Counting the cost of Australia’s delayed vaccine rollout report.
The report calculates international border closures after October will cost the Australian economy $7.6m a month.
It is an alarming figure given Finance Minister Simon Birmingham has all but ruled out any hope of opening the borders in 2021.
Senator Birmingham said international borders could remain shut well into 2022.
“We recognise that if Australians want to be kept safe and secure … and given uncertainties that exist not just in the speed of the vaccine rollout but also the extent of its effectiveness to different variants of COVID, the duration of its longevity and effectiveness, these are all considerations that mean we won’t be seeing borders flung open at the start of next year with great ease,” Mr Birmingham told The Australian.
McKell Institute executive director Michael Buckland predicted the airline industry could face more catastrophic financial losses.
“Australia has built a thriving economy based on open trade, immigration, and engagement with the world, and every week we go without these things it badly weakens our economy,” he said.
“If Australia’s border remain closed for even longer, the government has no choice but to increase support for the aviation industry and its workforce.
“Every Australian should understand exactly how costly this vaccine rollout delay has been, and that means taking into consideration the huge cost of border closures.
“As the India situation has emphatically underscored, an open economy like ours cannot possibly return to anything resembling normal until we have a vaccinated population.
“Lockdowns are devastating to the economy, but even if we were to somehow avoid any more, the cost of maintaining border closures is disastrous in and of itself.”