Photo Credit: CNBC
Any country with a big outbreak, such as China considers the financial impact that may follow. So that raises a question.
Will China’s economy take a hit from the coronavirus outbreak or is this super power strong enough to withstand this infectious period? What other countries will be affected?
Since the outbreak in Wuhan, China’s Chicago, there have been cancellations of tourism activities, entertainment events such as movie premiers and closing of theme parks. There have been travel bans enforced by other countries restricting travel to China. In efforts to contain the virus China has enforced travel bans of their own limiting travel outside of the country.
Experts predict that China’s economy will take a 60 billion dollar hit due to this outbreak, with the possibility of that number increasing if the state of isolation and panic brought on by the outbreak is not reversed.
The 60 billion dollars is a combination of what the government will spend to maintain and cure the virus as well as the funds lost by lack of trade, tourism, and other business ventures that have been put on hold.
This recent outbreak has been compared to that of the SARS virus of 2002-2003 which resulted in a 40 billion dollars of revenue lost on the global market. It took China approximately nine months to gain control of the SARS outbreak, while the coronavirus in China has infected 20,000 people in the last month.
The political climate of China may also be at risk as the funds predicted to be a loss may result in China not being able to fulfill obligations with other countries. For instance, it is predicted that China will not be able to fulfill the financial obligations of the agreement they made with the United States in January. As a part of this truce China agreed to buy 200 billion dollars in products from the United States.
The coronavirus spreading across China is a new strand, which is one reason the wave of infection has excited a wave of panic. Another reason this virus has been successful at creating a wave of panic is because there is no vaccine or cure. With the medicinal advancement, this may no longer be the case as so called ‘cures’ have been making an appearance across the internet as citizens look to fight to save their loved ones as well as themselves.