Worsening virus prospects
In the less than four weeks since I first wrote about the COVID-19 virus (“The bigger virus damage,” 2/7/20), confirmed cases worldwide have multiplied three and a half times as of this writing — that is, to 85,403 from 24,643 last month. What alarms many is that confirmed cases outside China have jumped nearly 25 times (from 243 to 6,009), and now in nearly 60 countries, twice the 28 a month ago. Deaths from the illness have multiplied nearly six times, from 493 to 2,924. The numbers imply an average mortality rate of 3.4 percent worldwide, higher within China (3.5 percent) but much less outside of China so far (1.4 percent), although Iran records an alarming 7-percent death rate.
For the Philippines, the reported number of confirmed cases has remarkably stood still, at three confirmed cases with one death, all “imported” via Chinese visitors. There were 30 “patients under investigation” recorded as of Feb. 28, after having exceeded 300 two weeks prior to that, but no new cases confirmed in the last four weeks. This either means that we’ve been extraordinarily effective in containing the virus, or that it’s not being detected properly, for lack of testing capability. Many seem convinced it’s more the latter. The fact that symptoms of the disease resemble that of the common cold or flu doesn’t help, and unless those afflicted seek medical attention and submit themselves to testing, many actual COVID-19 cases can go undetected.
Complicating the situation is the confusion caused by the widely divergent views in social media on the seriousness of the problem, with one side downplaying the alarm (“COVID-19 is not a death sentence”) and the other side making the direst projections. Bill Gates has called the coronavirus a “once-in-a-century” pathogen, while US President Donald Trump and his officials downplay the threat and accuse the media of “inflating the issue to bring down the President.”
What is clear is that the economic fallout from COVID-19, as I anticipated last month, is already emerging to be more virulent than the virus itself, and is already taking a big toll on economies worldwide. The most visible signs are tumbling stock markets around the globe. The Dow Jones index on Wall Street reportedly fell more than 14 percent last week, making it the worst drop since the 2008 global financial crisis. This can only feed more jitters and develop into a snowballing decline unless some good news manages to arrest the slide. Falling markets reflect pessimism over business prospects in the near future—and with good reason.
Airlines, including our own traditional flag carrier, are finding themselves in financial straits from having had to cancel numerous flights. This is due both to outright travel bans and people’s general aversion to traveling at a time when new “epicenters” of the virus have emerged outside China, as far afield as Europe. Worse, people from Asia, now the world’s largest tourism market, are experiencing outright avoidance and discrimination elsewhere in the world for fear of the virus, making it unappealing for us Asians to travel at this time. Inward travel into Asia has already seen severe curtailment, with Thailand reporting a 50-percent decline in tourist arrivals from a year ago. Tokyo Disneyland and Universal Studios Japan, among others around Asia, have announced temporary closures. Saudi Arabia has closed the holiest of Muslim shrines to foreigners. All sorts of large gatherings from concerts to conventions to trade fairs continue to be canceled.
Meanwhile, “factory of the world” China has announced deeper declines in manufacturing output due to factory closures forced by the virus. Repercussions in many economies that feed China’s factories and those buying their products are raising the specter of global recession. For us, and indeed for all other economies, the call of the times is to focus on internally driven growth, through spending by consumers, domestic investors, and government. “Build, build, build” could well be our own ticket to shield ourselves from creeping global recession, but for this to work, our infrastructure agencies need to do some major shaping up.
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