Business group Ibec said that the latest Covid restrictions, whilst devastating, were proportionate to the challenges which the country now faces.
Ibec's chief executive Danny McCoy said that many businesses will suffer further loss and distress as a result of the latest Covid restrictions.
But given the recent Covid developments internationally and developing on the island, the speed and intensity of the response was proportionate, Mr McCoy added.
"We will continue to work with Government to explore how supports to the worst impacted sectors can be extended and calibrated," the Ibec CEO said.
"The exceptional performance of the overall economy during the year has meant that Government has the necessary resources to support those sectors which are bearing the heaviest burden of the ongoing restrictions," he said.
"The adjustment of the restrictions to ensure that all of retail can continue to trade is the right call and will protect the livelihoods of thousands of workers over the coming period," he added.
Mr McCoy said that 2020 has been an exceptionally challenging one for all businesses.
"But Government, with support of a resilient economy, can continue to provide targeted measures to those businesses which have suffered the most," he said.
"We must collectively continue to address the challenge of the virus while preserving businesses and our economy for the strong recovery which will emerge in 2021 and beyond," he added.
Meanwhile, Retail Excellence has welcomed the decision by the Government to keep non-essential retail outlets open after Christmas.
But the group said it is urgently seeking clarification on the Government's plans for the deferral of Christmas sales.
Duncan Graham, Managing Director of Retail Excellence, said the decision to keep non-essential retail open reflected the work retailers had put in to safeguard their premises.
"Retailers have approached the Covid-19 crisis with the utmost professionalism and have put a number of safety measures in place to ensure the risk of virus transmission is mitigated," he said.
He also said that retailers would continue to exercise caution and urged shoppers to keep following safety guidelines.
"Retailers have the necessary safeguards in place to facilitate safe shopping and have been very successful in limiting the spread of the virus up to this point. Shoppers can also do their bit by following social distancing guidelines, washing their hands, and wearing masks," he stated.
The Retail Excellence chief today also praised the work of retail staff who have worked incredibly hard over the course of the year.
"This has been the worst year on record for the industry, and retail staff in shops around the country deserve huge credit for doing such a fantastic job under the most exceptional circumstances," he added.
The Small Firms Association said the move to reinstate Covid-19 restrictions was a serious blow to tourism and hospitality firms who had planned and prepared for the busy Christmas trading period.
Sven Spollen-Behrens, SFA Director, said that small businesses across the economy and country face a much tougher January and February than forecast just a few weeks ago.
"While many businesses impacted by these new restrictions will be able to access the Covid Restrictions Support Scheme (CRSS), firms in commercial premises, without premises and further down the supply chain will not be eligible to apply for CRSS," Sven Spollen-Behrens said.
"To ensure these firms can continue trading during the Covid-19 restrictions, the Government need to allocate funding for a new round of Restart Grants, extend the commercial rate waiver until April and introduce a binding mandatory arbitration process to manage disputes over commercial leases in 2021," he said.
The SFA boss also said that Brexit - in whatever form it takes - will pose challenges for small business in the new year – many of whom will have to adapt to new trading arrangements with the UK.
He said the Government must focus on keeping the cost of business down and ensure that the Brexit and Covid-19 supports that are available are rolled-out in a fast and timely manner.
"There are both disadvantages and opportunities that will be offered to the small business community in the New Year," the SFA boss said.
"We ask Government to continue to work with business to ensure our hospitality and experience economy reopens and that a greater number of office workers return to city centres and office parks next year," Mr Spollen-Behrens added.