France evaluates economic cost of new coronavirus

PARIS With only 11 cases of the novel coronavirus, from which two patients have already been given the all clear, France has, nonetheless, begun evaluating the economic cost of the worrying outbreak.

The fatal virus has killed over 1,300 people in China and three outside that country, and spread to 25 nations to a much more limited extent.

And the latest figures that indicate a faster spread of New Corona virus in China and a sharp increase of more than 240 deaths from Wednesday to Thursday are increasing concerns about health risks but also about parallel economic woes.

As China becomes more isolated, with dozens of countries either limiting or fully halting airline services with China and with travel and tourism at a standstill, Franco Chinese trade is being hard hit as is the tourism industry here that depends significantly on Chinese big spenders.

French Finance Minister Bruno Le Maire underlined those concerns earlier Thursday when he predicted that fallout from the virus would shave 0.1 percent of French growth in 2020, and we are still at early days yet.

He told LCI television that “the impact on Chinese growth would be one (percentage) point less for the year” and by extension this would mean “0.2 percent less at global level and 0.1 percent less growth for France.” France’s tourism industry accounts for over seven percent of total Gross Domestic Product (GDP) and Chinese tourists have taken a prominent place among foreign visitors and are known to be high spenders, especially in the luxury goods sector.

Beyond the tourism angle, France and China have had increasing trade ties, which will be affected pending a resolution of the virus crisis.

Already, French auto makers Peugeot and Renault, among others, have withdrawn their personnel from the Wuhan area, the epicentre of the virus outbreak and air links with China have been almost totally severed and the French Foreign Ministry has warned against travel to China.

Source: Kuwait News Agency