Since the explosion of news about the outbreak of the coronavirus, there has been confusion over how to respond and on what will happen to the world economy as a result. It’s safe to say the virus won’t help the already slowing world markets, which could lead us further into slowing growth and eventually into a downturn, perhaps sooner than we previously thought.
But for now, we can only speculate and keep watch on the world economy as the effects of the virus outbreak cause interruptions to plans as usual.
What is the coronavirus?
According to the World Health Organization, coronaviruses are a family of viruses that cause illnesses ranging from the common cold to severe respiratory failure depending on the cited case. A “novel” coronavirus, such as the one being reported on now, is a new strain that hasn’t been seen in humans before. The symptoms of this virus are flu-like.
Virus scares like this one aren’t uncommon and have many historical examples to look to for guidance. An older case was the Spanish flu of 1918, and a more recent one that gained mainstream notoriety was the Swine flu of 2009, a strain originally identified during the spread of the Spanish flu.
So then, what impact is this coronavirus having on the world economy?
When an outbreak like this occurs, a hit to travel worldwide happens as fear about contracting the illness becomes strong enough to instill caution. Neighbors to China, like Hong Kong and Macau, have been considering closing their borders to the mainland. Hong Kong has already closed most of its crossings. The U.S. and Europe have blocked travel from China and strongly advised citizens against traveling there. Various airlines in the U.S. have cancelled flights to and from China, in some cases until early spring.
As of writing, the virus’s death toll in China is over 300 with far more infected. The virus gained notoriety just as China entered its Lunar New Year celebrations, which usually draws in lucrative tourism. Because of the timing, tourism has dropped, and those industries are seeing a large hit anywhere within enough range of the affected areas to worry potential tourists.