Business with Declan Hasson: The economic cost of coronavirus

An Emergency Department Nurse during a demonstration of the Coronavirus pod and COVID-19 virus testing procedures set-up beside the Emergency Department of Antrim Area Hospital, Co Antrim in Northern Ireland. PA Photo. Picture date: Wednesday March 4, 2020. See PA story HEALTH Coronavirus Ulster. Photo credit should read: Michael Cooper/PA Wire

At the time of writing, Latin America, with its ‘landlocked ’population of 642 million, has recorded its first case of the virus.

It has successfully reached the other side of the world.

The toll that the virus is taking on human health is concerning.

Declan Hasson of Austins The Diamond, Derry. 0104JM14

For those who have been ‘stricken’ by the virus, there are anxious days ahead. Their only comfort is that this epidemic has, so far at least, a relatively low mortality rate. For those in compulsory or voluntary quarantine, there are mental as well as physical health issues to consider. It can be a thoroughly depressing experience.

The ‘lockdown’ strategy in Asia has been draconian. Normal life, as we know it, has been hugely disrupted. Its economy, which represents 30 per cent of global output, has literally ground to a halt. It is doing anything and everything to defeat the epidemic.

Car sales in China fell 92 per cent in the first fourteen days of February. Although that is but one simple statistic, it is an indicator of just how everything has effectively ‘stopped in its tracks’.

On February 21, when a number of cases of coronavirus were detected in the industrial region of Italy, the world’s stock markets went into free-fall.

With the virus now in the heart of Europe, fear and panic gripped investors, who hedged that the future would now be full of disruption and uncertainty – the true enemy of every business.

With Asia critical to global supply chains, many businesses are feeling the strain, though it could have been worse. Companies that depend on parts from China traditionally ‘stock up’ prior to the Chinese new year holiday. Those companies may now have the ‘breathing space’ to find alternative sources of supply.

The slump on world stock markets is similar to the great financial crash, but once the epidemic is contained and defeated, recovery should be swift.

Travel firms and airlines have been badly hit in this crisis, reminiscent of those terrible times post 9/11. Unfortunately, for some, this sorry episode will have done lasting damage.

There is some hope however, that with spring just around the corner, the worst may soon be over. China is already preparing to re-start economic activity within weeks.

The rest of the world will be holding its breath in hopeful anticipation.