Large government package for Svalbard’s tourism companies | Polarjournal
Tourism is one of the biggest sources of income in Svalbard. However, due to the measures taken by the government in Oslo, the inhabitants had fallen into an economically difficult situation and are dependent on government support until the situation improves. Archive photo: Julia Hager

The COVID pandemic has not yet reached Svalbard directly. But the protective measures enacted by the Norwegian government at the national level pretty much strangled the archipelago’s tourism-dependent economy. Since the beginning of the pandemic, visitor numbers have been virtually at rock bottom, putting many local businesses in an awkward economic situation. To save the situation, the government in Oslo has promised 13 companies a large aid package for restructuring.

A total of 11 million Norwegian kroner (NOK, about 1.1 million euro) has been allocated to the 13 companies, according to a list provided by the Norwegian Ministry of Trade. The beneficiaries include Visit Svalbard, which represents most of the tourism companies on Svalbard, and Spitsbergen Reisen AS. The two owners, Swiss Marcel Schütz and German Christian Bruttel, are currently on a tour and have not yet been able to comment on the approval of the financial injection.

Local tourism businesses in Longyearbyen, which benefited from 130,000+ visitors per year in Svalbard in pre-pandemic times, are still only allowed to welcome Norwegian tourists and even their numbers are lower than normal. The loss of revenue for the companies is estimated at an average of 65 percent. The aim of the subsidy programme is therefore to give the companies the opportunity to adapt to the new situation through appropriate restructuring and, if necessary, to position their businesses more broadly.

At the moment, only tourists from Norway can enjoy tours to the Svalbard hinterland. The help from Oslo for the local tour operators is therefore urgently needed. Picture: Michael Wenger

“There is a lot of interest in the program. This is money that can help businesses have more pillars and thus keep jobs in the future.”

Iselin Nybø, Norwegian Minister of Trade and Industry

Iselin Nybø, Norwegian Minister of Trade and Industry, is very pleased with the great willingness of companies to embrace changes in the market and to take infection control measures such as training. Among other things, the focus is on efforts to attract more Norwegian tourists through new offers, who would otherwise spend their vacations abroad. The individual restructuring projects are designed to help tourism businesses better prepare for future challenges.

The Ministry of Trade and Industry already put together an aid programme of NOK 250 million (about 25 million euros) for Norwegian tourism businesses last summer. Due to the great need, the programme is being continued this year with an additional budget of NOK 600 million (EUR 60 million). The current aid of NOK 11 million is granted to Longyearbyen-based companies independently of the NOK 40 million by which Svalbard’s budget was increased in February 2021.

Dr. Michael Wenger, PolarJournal

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