Russia restricts land border with China as virus panic spreads
Markets shudder at the thought of what might happen if the situation worsens
Moscow — Russia closed its land border with China on Thursday, saying passengers, not freight, would be targeted, as deaths from the fast-spreading coronavirus that started in China hit 170 and global markets shuddered.
The Kremlin’s emergency measures will likely hit the travel sector hardest. Only 3% to 4% of bilateral trade turnover comes from goods moving through checkpoints along the 4,210km border, according analyst Alexander Gabuev, the head of the Carnegie Moscow Center’s in Russia.
The government in Moscow will make a decision on restricting passenger flights between Russia and China on Friday.
Business Day TV spoke to Tshifhiwa Tshivhengwa, CEO of the Tourism Business Council of SA, to assess the potential impact of the outbreak on the country’s tourism sector.
All eyes were on the World Health Organisation (WHO), which has held off declaring the flu-like coronavirus a global emergency but was to reconsider that later in the day.
Such a declaration would trigger tighter containment and information-sharing guidelines but may disappoint Beijing, which had expressed confidence in defeating the “devil” virus.
It could also potentially spook markets further.
“The fear is that they [the WHO] might raise the alarm bells ... so people are taking money off the table,” said Chris Weston, head of research at Melbourne brokerage Pepperstone.
The day after a state economist forecast the crisis would lop a percentage point off China’s first-quarter growth, global stocks tumbled, the yuan hit its lowest this year, oil prices slid again and safe haven assets like gold gained.
The coronavirus, which originated in an illegal wildlife market in the central city of Wuhan, has now claimed 170 lives and infected 7,711 people in China, latest official data showed.
Almost all the deaths have been in Hubei province — Wuhan is its capital — where 60-million people are now living under virtual lockdown, staying inside their homes and only venturing out with masks on.
“Canteens are not open. Most of the shops are closed. We cannot go out and buy food,” Si Thu Tun, one of 60 students from Myanmar trapped in Wuhan, told online news outlet the Democratic Voice of Burma. “Honestly, I have one big potato and three packs of instant noodles and some rice,” he said.
Myanmar plans a special flight to get the students out within three days.
As other countries fly citizens out, cut flights and corporate travel, and heighten screening, another 105 cases have emerged in at least 16 places from Japan to the US. An Italian cruise ship’s 6,000 passengers were kept on board while tests were held on two Chinese travellers suspected of having the coronavirus.
The crisis has stoked a wave of anti-China sentiment around the globe, from shops barring Chinese tourists to online mockery and surprise checks on foreign workers.
Australia, South Korea, Singapore, New Zealand and Indonesia are quarantining evacuees for at least two weeks, though the US and Japan plan shorter, voluntary isolation.
Three Japanese, from 206 evacuated on Wednesday, were infected, and worryingly two of them had not shown symptoms, Tokyo said. A second Japanese flight included nine people showing fever or coughing symptoms, broadcaster NHK said.
India is the latest nation to report a case, a student of Wuhan University. And South Koreans protested at facilities earmarked as quarantine centres, throwing eggs at a minister.
“The weapons that will protect us from the new coronavirus are not fear and aversion, but trust and co-operation,” said South Korean President Moon Jae-in as Seoul prepared to evacuate the first of about 700 citizens from Wuhan.
In the corporate world, Alphabet’s Google and Sweden’s Ikea are the latest big names to close Chinese operations. Samsung Electronics said it has extended holiday closure for some Chinese production facilities.
Airlines to suspend flights to China include British Airways, Lufthansa, Air Canada and American Airlines. Air France cabin crew unions are demanding the same, sources said, though the company has already allowed pilots and crew to opt out of Chinese flights.
‘When China slows, we feel it’
Fuelling concern over the damage to productivity, thousands of Chinese factory workers on Lunar New Year holidays may struggle to get back to work next week, due to extensive travel restrictions imposed to stop the spread of the virus.
Global policymakers are anxious, with China taking centre stage at US Federal Reserve chair Jerome Powell’s news conference on Wednesday. “China’s economy is very important in the global economy now, and when China’s economy slows down we do feel that — not as much though as countries that are near China, or that trade more actively with China, like some of the Western European countries,” he said.
Streets in many Chinese cities were largely deserted and tourist attractions shut. Starbucks coffee shops required temperature checks and masks.
Cases of human-to-human transmission outside China are of particular concern to medics, but it is too early to determine how lethal the coronavirus is because there are likely to be many cases of milder infections going undetected. It has an incubation time of between one and 14 days.
Chinese health minister Ma Xiaowei said this week the virus was infectious during incubation, unlike severe acute respiratory syndrome (SARS), another virus that emerged from China and killed about 800 people in 2002 and 2003. The global cost from SARS was estimated at $33n, or 0.1% of world GDP in 2003.
Many economists fear the impact on global growth could be bigger this time than from SARS as China now accounts for a larger share of the world economy.