Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to demystify crypto stories to the bare basics so that anyone anywhere can understand without too much background knowledge. When he's not neck-deep in crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
The coronavirus may become a serious threat for the economies of China, Hongkong and the U.S., including their tourism sectors.
A quick solution is needed to curb the spread of the coronavirus in China. The Chinese government will have to work extra-hard with all health authorities to tackle the outbreak expediently. This is because the country’s economy will soon begin to suffer.
Coronavirus in China So Far
Already, about 9 people have died directly from the disease and more might die if care is not taken. Chinese authorities have also said that the virus has infected more than 400. In addition to that, almost 1,400 patients are being monitored closely. The pneumonia-causing virus was first discovered about a month ago in China’s Wuhan, a city in the Hubei province.
Also, authorities in China are unclear about the virus potency and how deadly it really is. Regardless, there is already a lot of panic as it continues to spread.
Possible Effect of the Coronavirus on the Economy in China
For a very long time, China enjoyed a budding tourist economy which grew consistently for a decade until 2003. A year before than tourism shot up by 12% but fell when the popular SARS virus hit China. Many would-be Chinese visitors postponed or completely canceled their trips to China, crashing the tourism sector. According to UBS Securities Head of Research Erc Lin, many tourism and hospitality-related companies crashed in value. Some shed as much as 50% of their weight within 6 months.
This loss spread to the economy at large, as China’s GDP fell to 9.1% in the second quarter of 2003 from 22.1% in the first quarter.
The SARS tragedy might happen again if the coronavirus is not quickly nipped in the bud. The tourism sector will drop, hotel bookings and flights will be reduced and it might take a while for the country to revive the sector.
Coinspeaker has already reported that the Asian financial markets reacted unfavorably to the spread of the virus. There is still the chance of further drops.
The U.S. also needs to make sure that it finds other possible cases of the virus in the country. This is just so it doesn’t also end up with hundreds of infected citizens like China currently has.
Spread of the Virus
The virus has begun to spread outside of central China. Hong Kong has already recorded is the first case of the coronavirus, even though deaths have not been reported.
Furthermore, the U.S. has seen the first coronavirus case. According to officials for the U.S. Center for Disease Control and Prevention (CDC), one person has been diagnosed. The CDC has withheld the person’s name but added that the patient is in isolation and “poses little risk” to the general public. The CDC has also confirmed that the patient, a man, is in his 30s and is currently “very healthy”. The man recently returned from China and alerted relevant authorities after he began to notice symptoms the resembled pneumonia.
Efforts to Curb the Spread
Chinese authorities have already begun heavy monitoring of travel channels. Authorities have also shut down most parts of Wuhan city. In addition, Bloomberg reports that the World Health Organization (WHO) will probably declare the coronavirus an international emergency later today.
So far, both the U.S. and China are still struggling to properly understand the virus.