Boats are pulled ashore as smoke and wildfires rage behind Lake Conjola, Australia, . Thousands of tourists fled Australia's wildfire-ravaged eastern coast Thursday ahead of worsening conditions as the military started to evacuate people trapped on the shore further southWildfires, Conjola, Australia - 02 Jan 2020

SYDNEY Australia was already impacted by its worst drought on record. But the devastating bushfire season, now compounded by the coronavirus outbreak, has made for a summer horribilis.

According to Australian Bureau of Statistics figures released Thursday, retail turnover for the month of December fell 0.5 percent to 27.77 billion Australian dollars, or $18.74 billion, seasonally adjusted, following a 1 percent gain in November, fueled by Black Friday and Cyber Monday sales promotions.

Australian Retailers Association executive director Russell Zimmermann said while year-over-year growth was the key index when interpreting retail sales data — 2.66 percent growth in December, a result he described as “pedestrian” and “disappointing” — month-over-month falls in department stores (down 2.8 percent); clothing, footwear and personal accessories (down 1.5 percent) and household goods (down 0.3 percent) — three of the four worst December results, in categories where November retail events were widely promoted — underlined the point that December sales were likely pulled forward.

“A similar factor seems evident where bushfires are concerned, with the worst monthly results in South Australia (down 1.34 percent) and New South Wales (down 1.24 percent) occurring in two of the states worst affected by bushfires,” said Zimmermann.

The ARA also anticipates that January’s retail figures, which are due in early March, will also be impacted by summer’s natural disasters.

Listed retail group Mosaic Brands, which owns among other labels Katies, Rivers, Rockmans and Noni B, has lost 31 percent of its share price over the past month after the company said in mid-January that comparable sales for the first half of fiscal 2020 were down 8 percent on the previous year, with 20 percent of its 1,386 stores directly impacted by the bushfires and 32 percent of its store network located in regional areas where consumer confidence has been particularly fragile.

Australian Surf & Boardsports Industry Association president Anthony Wilson predicts his industry will be particularly hard hit, with at least 50 percent of Australia’s 900 surf shops located down the east coast of New South Wales and Victoria, two states that were among the worst affected by the fires.

“It’s going to be a write-off of a year, to be honest,” said Wilson.

The fire season, which is ongoing, started in August and has burned through more than 27.2 million acres, claiming the lives of 33 people and more than one billion animals, with more than 2,500 houses lost. The disaster prompted a flurry of global fund-raising initiatives, which have raised more than 500 million Australian dollars, or $337.4 million, in donations.

Even large cities such as Sydney, Melbourne, Brisbane, Adelaide and Canberra, although located a long way from the fire fronts, have been choked with smoke haze on and off for months. Hazardous air quality in Melbourne last month wreaked havoc with players and spectators at the Australian Open tennis tournament.

Then came the coronavirus, which PricewaterhouseCoopers estimates could wipe 2.3 billion Australian dollars, or $1.6 billion, from Australia’s gross domestic product, should it significantly impact the multibillion-dollar Chinese tourism and education sectors.

On Saturday, the federal government banned all noncitizens and permanent residents who are arriving from or through China from entering Australia for at least two weeks, shutting the door on tens of thousands of Chinese tourists. The ban has also left roughly half of the 200,000 Chinese students enrolled in courses in Australia stranded in China, unable to start the new school year. Around 70 students were detained at Australian airports over the weekend, with their visas canceled.

China is Australia’s largest inbound tourism market, with 1.4 million arrivals in the 12 months to November 2019, spending 12.3 billion Australian dollars, or $8.3 billion, up 6.8 percent year-over-year, according to Tourism Australia figures.

China is also the number-one source country for Australia’s international students, representing a third of the international education market, which is now Australia’s largest service-based export and was worth 37.6 billion Australian dollars, or $25.4 billion, in fiscal 2019, up 15 percent, according to ABS figures.

Like the tourism and education sectors, Australia’s burgeoning luxury retail market has been supercharged by Chinese travelers, who helped buoy a 9.1 percent annualized growth rate over the five years through 2018-19 to reach 2.2 billion Australian dollars, or $1.5 billion, according to IbisWorld. It is estimated Asian, notably Chinese, tourists have accounted for as much as 30 percent of Australian luxury retail sales.

On Wednesday, the Australia and New Zealand Banking Group and AMP Capital warned the combined impact of the fires and the coronavirus outbreak could see the Australian economy record a negative quarter of growth in the first three months of 2020.

Although the ARA’s Russell Zimmermann said it is too early to gauge the impact of the coronavirus on the retail sector specifically, he said he understands some Australian shopping centers have already been directly affected by the travel restrictions and consumer jitters, while Australian retailers are also starting to grapple with Chinese supply-chain headaches.

“There are certain areas of the country where retailing has gone very quiet, particularly areas that have a very high population of Chinese people living in them, that’s number one,” said Zimmermann. “Number two, we’ve got retailers now getting notification from their suppliers to say things are going to be late [due to factory closures in China]”.

Scentre Group, which operates Westfield shopping centers in Australia and New Zealand, declined to comment on whether any of its centers have been affected. The David Jones department store chain also declined to comment on any immediate business impact. The latter is known as a magnet for Chinese tourists and notably, big-spending Chinese students, particularly on the premium beauty floors in its large metropolitan stores.

“It’s more than a one-two punch,” added Zimmermann of Australia’s challenges. “You’ve got the bushfires, you’ve got the drought and you’ve got the coronavirus. I can’t ever remember seeing three things like this in the last 15 years of retail or even the last 40 years of retail.”

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