ECONOMY CORONA
Human cost of
coronavirus
climbing response to
the outbreak
The human cost of the
coronavirus outbreak is
climbing across China and
beyond. The economic cost is also
mounting, mainly, but not only, in
China.
That damage is, for the most part,
not due to the virus itself so much as
efforts to prevent it spreading.There
are strict restrictions on moving
out of Wuhan, where the outbreak
began, a city with a population of 11
million.
The lockdown, also now extended
to other parts of Hubei province,
prevents business-related travel as
well as the movement of goods and
workers.
Fear of the virus also means many
people will choose to avoid activities
they think might expose them to the
risk of infection.
So restaurants, cinemas, transport
providers, hotels and shops are all
quickly feeling the impact.
And the timing of the health
crisis, during the lunar New Year
break, means those industries
have been particularly exposed to
commercial losses.
The New Year holiday was
extended for a few days by the
national Chinese authorities and
there have been longer extensions
imposed by some provincial
authorities, delaying the return
to work for some businesses even
longer.
Any delay resuming production
and selling goods is likely to lead to
cash-flow problems, especially for
smaller operations.
Many companies will have to
continue paying bills, including
employees' pay.
And for manufacturers selling
goods abroad, there may be some
issues with buyers becoming more
reluctant to buy from China.
The impact is not confined to
China. International retailers have
closed operations in China - the
furniture seller Ikea and the coffee
shop chain Starbucks, for example.
Several overseas airlines have
stopped flights to China and
international hotel chains have been
offering refunds.
And beyond that, there is
growing concern about integrated
42 February 2020 | www.smartgovernance.in