China is intensifying efforts to combat the coronavirus outbreak as more cases appear worldwide. The fear of the virus spreading beyond Wuhan has caused stocks to decline globally on Tuesday.
During the Lunar New Year festivities, which see hundreds of millions of people travelling, concerns about the virus spreading have caused a drop in stocks. While some are avoiding travel during this time, many Chinese citizens are still going around the country to celebrate. The World Health Organization has reported over 860 cases in China with at least 26 deaths. China’s Finance Ministry has allocated $145 million to support Hubei provinces in their fight against the virus. South Korea and Japan have also confirmed additional cases.
Industries like oil and travel have been significantly affected by the consequences of this new disease. The possibility of a major unexpected event has caused stock markets in Hong Kong, Shanghai, and Shenzhen to fall by 2%-3.5%. Global oil prices have dropped by 3%. Hotels are facing losses due to cancelled reservations over virus concerns. If the virus continues to spread, experts predict a decline in travel, tourism, and retail sales for the coming months.
This outbreak comes at a challenging time for the Chinese economy, as it is already facing a slowdown. With economic growth at a 29-year low, there are concerns that the coronavirus could exacerbate the economic stagnation being experienced in China.
