SARS impact serious but not overwhelming: APEC report

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Last updated at: (Beijing Time) Saturday, October 18, 2003

SARS impact serious but not overwhelming: APEC report

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The impact of the outbreak of Severe Acute Respiratory Syndrome (SARS) on the economic development in the Asia-Pacific Economic Cooperation (APEC) economies was "serious," but "not overwhelming," said an APEC report issued Friday in Bangkok.

"The economic cost has been estimated to be in the range from 0.5 percent to 1.0 percent of annual GDP (gross domestic product) growth for many of the economies of the APEC region," said the report by the APEC Economic Committee.

It noted that as the SARS outbreak was uneven in its incidence,the economic impact had also been unequal across sectors.

As the fear of contracting disease causing people to reduce contact with others, the first impacts were the reduction in travel and tourism industries.

Among countries that the tourism sector played an important role in national economy, the outbreak of SARS had a relatively stronger impact on the GDP growth, according to the report.

Quoting the Asian Development Bank's estimate of the SARS impact on GDP growth, the report pointed out that the outbreak of SARS would cause relative higher loss of GDP growth of Malaysia and Thailand though there were no cases reported in the two countries.

GDP growth of Malaysia and Thailand were estimated to reduce 0.6 percent and 0.7 percent respectively due to the fact that tourism accounts for a very high share of GDP in the two economies.

Singapore's economy was also hard hit, with the travel and tourism sector particularly hurt. The sector reported a 67 percentdecline of visitors in April, when the epidemic was at height of outbreak. The city state's GDP growth was estimated to decline by 1.1 percent.

In China, which reported high infected cases, the estimated reduction of GDP growth was only 0.2 percent.

It's because trade and investment, the main driver of China's economy, were less impacted by SARS, while the tourism sector carried a relatively low weight in China's economy.

The report went on to say that "the overall economic situation in China is still very robust" despite a significant decline in the second quarter growth.

Besides the tourism sector, SARS also had a negative effect on consumer confidence. But the report affirmed that overall investment, industrial output and international trade had been little affected by SARS.

The report quoted the World Health Organization's warning as saying that the resurgence of SARS remained a distinct possibility.

The APEC region accounted for 99 percent of SARS cases, and 99 percent of SARS-related deaths worldwide.

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