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The economic and social recovery phase to the Covid-19 pandemic response begins on Thursday — and while many are rejoicing, some say it could be too late.

• Level 2 - all you need to know

Prime Minister Jacinda Ardern yesterday announced a phased return to life after lockdown as people would be allowed to visit with family and friends - in groups limited to 10 - for the first time since the end of March, and retailers, malls, cafes, restaurants, cinemas and other public spaces could reopen, on Thursday.

From Monday, May 18, all schools and early childhood centres could open.

But bars would have to wait 10 days, until Thursday May 21, before reopening, with gathering limits to be reviewed in two weeks.

Dunedin Mayor Aaron Hawkins said it was "really positive" the public health response now allowed for the resumption of some economic and social activity, but many were still being asked to make great sacrifices.

"If you think about trying to put together a guest list for a funeral for a family member of fewer than 10 people, that’s fairly traumatic to have to consider, and you can’t underestimate the sacrifice that we are still asking people to make to keep this thing under control," he said.

"I acknowledge that that is particularly hard when you see yourself as the last cab off the rank, but it is important that we don’t blow it at this stage. And bars are a high-risk component for transmission.

"Those aren’t easy decisions for anyone to have had to make, but again, they were weighing up the best health advice they had and also the desire to see a return to as much economic activity as can safely be managed as soon as possible. I think the compromise reached around bars reopening is a solid example of that."

A priority for the Dunedin City Council was reopening the public libraries, and work on "at what point" galleries, museums and Moana Pool could operate under Level 2 was still being worked on.

Learning she would be able to open her doors on Thursday brought tears to the eyes of the owner of Dunedin women’s clothing store Paint The Town Red, Diane McKenzie.

"I’m feeling very, very happy and a little bit emotional, I have to say," she said.

"No income at all for seven weeks is pretty damn tough."

She had suppliers she owed money to and the lockdown was when sales of winter clothing were expected — when she usually made most of her profit.

"I really don’t have a big window of time to sell a shopful of winter clothes."

She was considering having a big sale upon opening to help sell the stock, but that would mean taking a hit on her already diminished revenue.

Invercargill's Rogersons Footwear owner Rex Sinclair had had the store for 31 years and was confident his experience would get him through tough times.

"Anyone who was indebted a wee bit would have suffered a lot worse ... I can imagine if this happened when we first went in there, it would have been a nightmare."

The Otago Southland Employers Association chief executive Virginia Nicholls said she was pleased the Government had showed confidence in businesses operating safely, but it would be too late for some.

"Businesses are struggling, and opening up travel, tourism, retail and hospitality will be a step in the right direction.

"We are aware that this will be too late for some businesses who have closed or who are considering restructure and redundancy."

Hospitality NZ chief executive Julie White said she would be "strongly advocating" for further relaxed regulations if establishments could offer a safe environment to dine in.

Air New Zealand announced it would bring back seven domestic routes - including return flights to Dunedin from Auckland and Wellington from Monday June 1.

Queenstown Lakes Mayor Jim Boult said it was exactly what the district was hoping for.

"I am very much hoping we will see some Kiwis on holiday arriving on those planes," Mr Boult said.

While he did not expect a flood of visitors into the resort, "going from no business" to the reopening of the domestic market was "a very positive move and something I am very pleased about".

Skyline chief executive Geoff McDonald said the company aimed to restart the Queenstown gondola and luge by the weekend.

"We're thrilled the Government has had the confidence in us to get on with it. We think we can deliver it; everyone is ready and up for it.

"Everybody is keen to get on and start the new future."

Enterprise Dunedin city marketing manager Malcolm Anderson said weekly video conferences about moving out of the public health response phase - attended by more than 50 operators on average - showed as a whole the sector was looking forward to Level 2, but for each operator there would be difficult decisions to make about how to reopen their businesses.

"It’s a great step towards Level 1 and a whole lot of them have been working through a whole lot of scenarios waiting for this day to see what they can and can’t do."