TAIPEI (Taiwan News) — As airlines continue to scrap almost all flights, the tourism sector is suffering a huge blow from the coronavirus (COVID-19) outbreak — one that is "far bigger" than during the 2003 SARS outbreak, said Taiwan's central bank on Thursday (March 19).
The COVID-19 crisis is having a ripple effect across Taiwan and around the world as activities grind to a halt. The central bank said that the epidemic is affecting supply chains, disrupting manufacturing operations, and hurting domestic demand, so it is cutting the country's growth outlook to 1.92% for 2020.
As more nations have imposed lockdowns and bans on all foreign visitors, tourist agencies in Taiwan have halted overseas tours until the end of April.
During the SARS outbreak in 2003, the total passenger traffic at the country's international airports dropped by 69.5 percent, with the number of outbound and inbound visitors down 71.5 percent and 68.7 percent, respectively. Overall, the economy slumped into a negative growth rate of 1.15 percent.
16 years later, however, the new coronavirus appears far more contagious and deadly, leaving planes to fly almost empty across the world. The passenger load in cross-strait and Hong Kong-Taipei flights nosedived 90.9 percent and 94.4 percent, respectively, in February from last December.
"Frankly, a V-shape rebound in travel is unlikely," the central bank said.
The central bank admits that the hit will be far-reaching, as the stock market's freefall is going to take a heavy toll on consumption and investment, which will be worse than it was during the 2003 SARS outbreak.
Also, small and medium-size businesses will feel the brunt of not only lower output and demand but a massive credit crunch. The central bank is advising that the government move forward quickly on a bailout as well as boost plans to deal with the impact.
The bank is joining other major global financial institutions in lowering forecasts worldwide. It is revising the country's 2020 growth forecast downward by 0.65 percentage points to 1.92 percent.
