Leon Neal / Getty Images
A fatal virus outbreak in China has triggered a wave of travel and trade restrictions between the two largest economies, which could hit billions of US tourism companies this year.
Airlines and hotels have been increasingly anticipating a downturn in business in recent days as Americans are making greater efforts to curb the corona virus more than 1,100 killed distributed worldwide and in at least two dozen countries. The Trump administration announced a travel ban on China in early February, and major airlines have suspended flights to and from China until April.
China has emerged as the largest source of American travel-related exports, spending around $ 34 billion last year on travel and transportation services. However, the corona virus could cause Chinese visits to the U.S. to decrease 28% in 2020. according to the estimates of the tourism economy, a branch of Oxford Economics. This could result in a loss of $ 5.8 billion in flight and domestic spending. according to the Wall Street Journal,
Coronavirus is expected to have a more significant impact on travel in the early 2000s than SARS or severe acute respiratory syndrome. Visits from China to the United States have increased almost tenfold since 2002 to an estimated 2.8 million in the last year, the consulting and data company estimated.
From tourism to international supply chains, China has since become much more closely intertwined with the world market. With shops and factories idling in the second largest economy, the outbreak of the corona virus is slowing down activity in a broader sense.
"China is a far more important engine of the global economy than it was during the SARS phase in 2003. Further production and travel interruptions will continue to make major global waves," said Richard Falkenrath, chief security officer at Bridgewater Associates.
A recent morning consultation survey 44% of respondents said they were less likely to travel abroad in the next six months because of the corona virus. Travelers were also reluctant to travel within the country, with 17% saying they were less likely to do so after the outbreak.
"If enough consumers postpone their plans by the end of the year, corporate earnings may reflect an atypical seasonality," said Morning Consult economist John Leer.
(tagsToTranslate) Coronavirus (t) Tourism (t) Travel (t) GDP (t) China (t) USA.