SINGAPORE (Reuters) – Asian economies could lose $105-$115 billion in gross domestic product (GDP) this year due to a slump in tourism following the outbreak of the coronavirus, ING said in a report on Monday.
“If we assume that tourism to and from China basically grinds to a halt in 2020, and extra regional tourism also diminishes, then the cost to the region from lost tourism revenues alone is approximately $105-$115 billion,” said Robert Carnell, ING’s chief economist for Asia-Pacific.
In a report titled “Holidays in hell”, Carnell said the research assumed zero tourism receipts for Asian countries from inbound China visitors as it sought to calculate the total loss from the epidemic.
“That’s obviously a gross simplification, but it fits a scenario where the epidemic lingers long after it peaks. Official travel restrictions may be slow to be removed, and travelers may remain wary long after it is safe for them to travel again,” the report said.
Fears of a coronavirus pandemic grew on Monday after sharp rises in new cases reported in Iran, Italy and South Korea.
The virus has infected more than 77,000 people and killed more than 2,500 in China, most in Hubei province, the epicenter of the outbreak. Outside mainland China, the outbreak has spread to about 29 countries and territories, with a death toll of about two dozen, according to a Reuters tally.
From Bali to Bangkok, Asia’s main tourism hotspots have suffered thousands of cancellations, even as countries impose travel restrictions to try and halt the spread the virus.
“While Thailand tops the poll for the region as a whole in terms of pure numbers, Chinese tourists are still a very important source of income for other South East Asian economies,” ING said.
As part of its analysis, ING included spending by outbound tourists to China, as well as the inbound Chinese tourists that will no longer be visiting countries in the region.
(Reporting by Anshuman Daga; Editing by Alex Richardson)