https://www.theguardian.com/business/2020/jan/23/financial-markets-china-coronavirus-outbreak-economy
There is a new virus outbreak that started in one of China's booming car manufacturing city. With the growing concern over the spread of the virus, China is trying to contain the virus and shut down four other cities, and also banned travel during the Lunar New Year, where people are expected to travel across the country to celebrate with their friends and families. With this travel ban, people are now fearing that this virus would affect economic growth and slow down the economy. But, China has dealt with a similar situation before in the 2003 Sars virus outbreak, which caused an estimated decline in China's GDP growth between one and two percentage points. But, it's a different time now and China is a booming economic giant for countries worldwide. There was a strong recovery following the Sars outbreak and this gives hope to people that the coronavirus may also have little impact if it can be contained. According to some of the economists, if this virus is not contained, tourism, retail sales, and travel would be hit in the next few months.
Do you think this coronavirus could be contained and how big of an impact would this virus had on the world's economy?
9 comments:
I think there is a concern for the virus spreading some more, especially now that there are cases in the United States in California. If the virus spreads more, there is a strong possibility that the world's economy could struggle. Treatment cost, healthcare, and increased number in deaths can negatively affect society. However, treatment costs can increase economic returns and help an economy prosper.
I believe that this virus is bound to possibly spread since there are cases outside of China in countries like Taiwan, Pakistan, U.S.A, Singapore, Nepal and more. The government has also affirmed the spread of the virus, making it difficult to contain in the short term. It's an epidemic issue, so not only will it effect the economy in terms of shutting down many industries like tourism, air travel and so on, but it will also impact the population's general health, employment, and possibly the price of healthcare. This could have a snowball effect on other sectors of the economy, aiding to reduced growth. The world's economy would be impacted heavily if this virus rapidly grows since several countries are dependent on China for trade, and it would have an adverse impact on their growth as well. Additionally, since the outburst took place during the Lunar New Year, the most profitable holiday for the country, businesses have taken an even harder hit.
As the news of coronavirus spreads worldwide, economic activity has slowed down, especially tourism and retail sales industries are badly impacted. I doubt it that it could be contained in upcoming weeks, as it is spreading really fast, which means that countries dependent on China for trade will see a negative impact in the financial markets.
The coronavirus would definitely affect tourism worldwide. It is not just tourism to China that would decline, there will be or probably is a decline in Chinese tourists to other countries. China is the largest contributor to outbound tourism and they spend more money than the average tourist does, especially on luxury brands. So the decline (of both Chinese and non-Chinese tourists) would affect economies that depend solely on tourism service for there will be a greater fear of the coronavirus spreading even more. It would hurt even more since the outbreak happened before Lunar New Year.
It is encouraging though that China has taken the necessary measures to try and contain the spreading of the disease. But the virus outbreak affects the consumer confidence of the largest consumer economy (China)and that is a huge loss to the world economy in concerns to consumer goods. Hopefully the coronavirus follows the SARS virus in that it went away relatively quickly and a vaccine is in the works.
I believe that we have already began to see fears in the markets you described, and others throughout the worldwide markets. With so many companies relying on China as a manufacturing hub, I believe that this may have a negative impact on the supply chains of those companies. However, I do not see it becoming a large enough problem throughout the US and Europe that it would hurt the travel and tourism industries here.
The coronavirus outbreak could prove to be very costly for many countries. Most do not necessarily even need to actually have any confirmed cases but the thought will drive consumer confidence and spending down at least a little. But China is going to be reeling from yet another hit to their economy. It will be interesting to watch as the whole world watches as more and more news comes out about the virus.
The coronavirus is not as deadly as SARS in 2003. However, it has spread very quickly by rapid global transportation with the rapid development of globalization. The coronavirus effects have quickly spread around the world. As a member of the younger generation of Chinese, this is the first time I have really felt how the virus affects people’s lives and the development of society. Right now in China, traffic control has been imposed in most of the cities, and most of the public transportation has been suspended. In former years, during the spring festival, most of the Chinese people prepared to celebrate the festival by shopping and walking on all the main shopping streets. This year, however, most of the shopping stores and restaurants are closed, and only a few people are walking on the street to buy life's necessities. This situation really hurt China’s economy at the end of 2019. Today, since China is the second-largest economy in the world, the coronavirus situation certainly may have a negative effect on the global economy. All of us are hoping China can overcome the coronavirus as soon as possible.
I do believe that the coronavirus can be contained, and will not be nearly as horrific as the SARS outbreak as we have improved technology and medical facilities. However, I predict that there will be a major economic downturn in China because of the outbreak as it will take months if not a year for tourists to be comfortable enough to travel there, as well as people will be less inclined to go shopping and consume products because many stores are closed, and consumers still do not believe the environment is safe enough for them to do so.
The Virus has already had a significant impact on the country, nearly slowing its growth to nothing. Containment shouldn't be a problem for China, but the expenditures that are going to come from this outbreak are going to affect them in a big way. Many airlines have already stopped flights in and out of China due to the coronavirus. At this point we can say that this virus is not only going to hurt China, but the world all together.
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