The recent swine flu that started in Mexico City has put all nations on alert as the death toll and numbers of infected people continue to rise all over the world. So far, 113 cases of the swine flu has been confirmed in US, Canada, Spain, New Zealand, UK and even Israel from its original hotbed of Mexico. Now, health experts are predicting that it might be starting to emerge in Asia as the World Health Organisation recently raised its alert levels from three to four on its six-level scale.
As the world rushes to contain it from spreading into a pandemic, it is scary to note that not even the economy is spared from this health scare in our interlinked world. Read below to understand how badly the ailing world economy can be further affected if the swine flu spread into a pandemic.
Impact Of The Swine Flu On The Economy
- Travel alerts have been issued all over the world which will only hurt an already beaten airline industry and all related industries in the hotel, restaurant, transportation and shopping lines.
- Increased airport checks and security measures will deter more people from traveling and increases medical and monitoring costs for all countries.
- Stores, schools and businesses forced to close to avoid containment squeezes economic growth.
- Economies dependent on tourism, such as New York or New Zealand, will be badly hit as their main source of income starts to decline.
- Avoidance of crowded areas such as shopping malls or games causes a drop in consumer spending and shrinking of the local economies.
- Banning of pork products from affected countries will further affect their agricultural economy, especially if it is their primary industry.
How bad can it get if the swine flu worsens to a pandemic level? The World Bank has some figures below which are staggering especially for a world economy that is still valiantly fighting its way out of a recession.
If there’s a pandemic on the level of the 1918 “Spanish” flu, a 2008 World Bank analysis says, it would cost the world economy $3.1 trillion and drop the world’s gross domestic product by 4.8 percent in the first year of infection.A pandemic like the less severe 1957 “Asian” flu would reduce global GDP by 2 percent, The World Bank concluded, while a pandemic like the most recent 1968 “Hong Kong” flu would cut world economic output by just under 1 percent. (source)
Economically, there couldn’t have been a worst time for this health scare to hit the world. Hopefully, international health experts will be able to contain it to controllable levels. In the meantime, do try to stay healthy with these flu preventive tips.