Hira Bahadur Thapa

With more cases of death and illnesses than the 2002-03 SARS (Severe Acute Respiratory Syndrome) epidemic, novel coronavirus is becoming a menace. Governments worldwide have been taking necessary precautionary measures to contain the spread of the virus. In China where the number of 2019-nCoV casualties has topped the list, the leadership has taken bold steps to control the disease. In its rare display of promptness and efficiency during emergencies, the country has completed the construction of a 10,000-bed isolation hospital in Wuhan, the epicentre of epidemic, in about a week to treat the virus-infected patients.
Whatever China has done till now to curb the transmission of new epidemic in collaboration with other countries has earned an acclamation globally. Wuhan has been locked barring all modes of transportation to and from it since January 23. So are other major cities in China. Lunar New Year holidays have been extended to make people stay inside homes and avoid going outside unless needed for urgent business.
In the similar vein, many international airlines of the US, Europe and other countries have suspended their operations. This has restricted the movement of people. Though such travel restrictions seem necessary to control the virus, it has severely limited chances for people to move around the world. The World Health Organisation (WHO) has declared coronavirus a global health emergency.
The WHO has pledged some financial package to China to help halt the spread of coronavirus. The US government has, too, announced that it will assist China in containing the new disease. Scientists in the developed world are struggling to experiment new drugs to treat the patients of virus. Even China has employed its scientists to do necessary research for vaccines. Some reports suggest that new anti-HIV drugs are found to be helpful in the treatment though the WHO has declined to confirm such findings. Nevertheless, scientists around the world are busy in continuing research on the subject and hopefully solution would be found albeit it is too early to predict when.
China has favourably responded to the US request to include its experts in WHO team meant for developing the vaccines. Increased collaboration in the field of necessary research to find out the drugs and vaccines is in the interest of humanity.
While China has borne the brunt of epidemic, no country can remain immune from adverse economic consequences arising out of the disease, which has started showing its knock-out-effects on the global economy.
The airline industry and auto industry are in the forefront of economic pitfalls. Major airlines of the world, including those from the US, Europe and Australia have suspended flights to and from China. Even Hong Kong’s flagship airlines Cathay Pacific has had to ask its 3700 employees to take unpaid leave for some weeks in view of curtailed operations and reduced passenger demands.
The Chinese airlines are no exception as a result of which Nepal, a country heavily dependent on the flow of tourists from the northern neighbour has suffered substantially in terms of cancelled reservations in the hotels in Kathmandu, Pokhara, and Sauraha, among others. China is the second largest tourist source market for Nepal after India. Such cancellations have come at a pivotal time for Nepal, where the Visit Nepal Year 2020 is in full swing.
The other day, ,national coordinator of Visit Nepal Year 2020, Suraj Vaidya, in an interaction arranged by the Hotel Association Nepal (HAN) in Kathmandu, emphasized the need to for searching for alternatives to China from where Nepal was expecting to attract as many as a half million tourists this year. In the recent years, the flow of Chinese tourists was on in the rise because of on account of frequent flights from Chinese airlines to and from Kathmandu and also because of their higher incomes as per capita has gone up to $9000 compared to $1500 a decade or so earlier.
It may be impossible to correctly calculate the economic losses both domestically and globally due to epidemic despite all the sincere efforts of China and other nations to contain the transmission of virus. Some economists have predicted that damage to global economy this time would be much higher than that of the 2002-03 SARS outbreak. The reason is that China has become a dominant global economic engine, a manufacturing hub with Gross Domestic Product (GDP) reaching $13 trillion compared to just $1.3 trillion in the early 2000s in the aftermath of its accession to the World Trade Organisation (WTO), capturing one third of world’s trade, which is more than that of US, Europe, and Japan combined. In the opinion of a former US Federal Reserve Board chair, Janet L. Yellen “though past epidemics such as SARS delivered a short-term economic blow, it is unclear whether this will be the case with the coronavirus” (The Washington Post). In 2004, the economic losses to global economy were calculated to be around $40 billion. This new outbreak could not have come at a worse time when China was slowly picking up economically with increasing exports to the US, consequent upon its recent trade truce with that country. Higher debts have become its economic burden.
Furthermore, closed factories for lengthened periods due to epidemic will likely add more pain to a country of 1.4 billion, where millions of migrant workers have been forced to stay homes because of suspended work in the cities like Wuhan, populated by 11 million, which is considered to be an industrial hub in Hubei province of central China. As per Oxford Economics, China’s economic output has multiplied more than eightfold since SARS outbreak to nearly $14 trillion from $1.7 trillion (The Washington Post). Therefore, any damage to China’s economy will surely have huge implications in the future of world economy.

(Thapa was Foreign Relations Advisor to the Prime Minister from 2008 to 2009. He writes on contemporary national and international issues. He can be reached at thapahira17@gmail.com)