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Queensland Economic Advocacy Solutions

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Economic Lessons from Queensland's Severe Tropical Cyclones

When it comes to severe tropical cyclones the imperative rightly has to be on ensuring Queenslanders are safe and out of harms way. We must then immediately render assistance to the townships and communities decimated from the extreme weather event.

However following these two priorities there are many valuable lessons that have been learned the hard way that must be heeded in order to ease the financial hardship on those directly impacted and many others as well.

The three major cyclones to have hit Queensland’s coastline in recent memory and their estimated economic costs are:

  •  Severe Tropical Cyclone Larry: Category 5 and made landfall near Innisfail on 20 March 2006 and resulted in $1.5 billion in damage which at the time, made it the costliest tropical cyclone to ever impact Australia; surpassing Cyclone Tracy in 1974.
  • Severe Tropical Cyclone Yasi: Category 5 and made landfall near Mission Beach on 3 February 2011 and spanned an area from Ingham to Cairns. Initially thought to have caused $800 million in damage but ultimately estimated at $3.5 billion, making it the costliest tropical cyclone to hit Australia on record.
  • Severe Tropical Cyclone Marcia: Category 5 and made landfall near Shoalwater Bay on 20 February 2015. The cyclone went on to affect various areas including Yeppoon and Rockhampton. Marcia was estimated to cause $750 million worth of damage.

A notable mention is also Tropical Cyclone Oswald (Category 1) and whilst lacking in high winds dumped severe rainfall in January 2013 as it travelled down the southern coastline of Queensland leaving flooding and coastal erosion with a damage bill across the State and NSW near $2.3 billion.

Aside from the physical damage to households, businesses and infrastructure the main hits to the Queensland economy have previously been in the areas of lost coal export, lost rural production and lost tourism dollars.

Based on previous natural disasters in Queensland the indirect impacts of these events can be far worse than the direct impacts.

By mid this year we will have a full estimate of the economic cost of Severe Tropical Cyclone Debbie. We already know that much of the sugar cane harvest for this year is under threat and coking coal exports from several ports (Mackay, Hay Point and Abbot Point) are temporarily on hold.

What will come as a surprise to many though is that the economic impact on tourism is largely in our control.

Unfortunately Queensland cyclones leave devastating and heartbreaking images on the minds of millions. The news coverage and graphic vision of the destruction turns physical damage into financial damage for tourism.

These negative images can mistakenly lead to the impression that all of Queensland has been devastated and that the state is "closed".

It is not uncommon for tourism operators to report widespread cancellation of bookings across the entire length of our eastern coastline. There are already reports that cruise ship companies are giving Queensland a wide berth and this only increases the economic losses.

We should pause to consider the hardship now being experienced by those who have been directly hit, however their losses will only further be compounded if they lose their livelihood as visitors steer clear of communities like Airlie Beach and the Whitsundays that rely on tourism.

Interestingly many tourism operators previously report being up and running within days of an event. Once they’re back on their feet they need patronage otherwise their damage becomes far far worse.  Key periods such as the upcoming school holidays and Easter will represent a make or break period for them.

Furthermore the geographical size of Queensland is typically underappreciated by those interstate and overseas.  Despite extensive damage it is localised with the vast majority of the State and tourism operators will be unscathed following TC Deb.

We cannot control Mother Nature and her fury but we can minimise the financial damage done by her if we are proactive about messaging.

Arguably the biggest economic lesson learned from severe tropical cyclones in Queensland is to be very aggressive in getting the message out that we remain "open for business".

 

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