China virus crisis will have an impact – and life may not be the same again

When strategists and observers wrote of what to expect in 2020, few if any foresaw the health crisis that is hitting the global ­economy as a result of the coronavirus outbreak that started in Wuhan, China. The pebble dropped there has sent ripples around the world and it is worth considering their possible impact.

A staff member wearing a protective mask and suit works at a supermarket in Wuhan, the epicentre of the outbreak of a novel coronavirus, in China's central Hubei province. - The death toll from the novel coronavirus surged past 900 in mainland China on February 10, overtaking global fatalities in the 2002-03 SARS epidemic, even as the World Health Organization said the outbreak appeared to be stabilising. (Photo by STR / AFP) / China OUT (Photo by STR/AFP via Getty Images)

First, healthcare. The SARS ­outbreak and ebola both created health crises that were eventually brought under control and they were, of course, much smaller than the infamous outbreak of Spanish flu after the First World War that killed more people than died in that war. Corona differs in an important aspect – early warnings were overlooked and then supressed in Wuhan.

Li Wenliang, the 34-year-old ­doctor who raised the alarm was ignored, then arrested and has now died in hospital. Normal medical procedures and WHO paths were not ­initially ­followed, and the central party machine moved to minimise and try to isolate the rapidly deteriorating ­situation.

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This was compounded by the ­massive movement of people at the time of the Chinese Lunar New Year, when families travel for reunions and gatherings. When the extent of the danger of an epidemic assuming ­pandemic proportions was realised the central government began the process of shutting down entire provinces and restricting movement in a way that would be difficult in the West. President Xi Jinping has described this as a “major test for ­China’s system and capacity for ­governance” – this was the healthcare ‘black swan’.

Roddy Gow, Chairman and Founder, The Asia Scotland Institute

Second, economics. Little scenario planning envisaged the effect that this the form of government-imposed lock down and quarantine would have on disrupting manufacturing and supply chains in the interdependent world in which we live.

“It’s not the disease, it’s the treatment,” wrote analysts from Gavekal Dragonomics, quoted in The Economist. Beijing has announced that it is deploying the equivalent of $173 billion of liquidity to money markets. In Scotland, Chinese tourism figures so far this year seem to indicate a 20 per cent reduction in travel bookings. Chinese markets have been shut since 24 January after the ­holiday was extended.

According to newspaper reports the Chinese regime is tightening its grip on information about the ­outbreak, as it seeks to control the narrative on the worsening epidemic that has seen daily surges in infection and death numbers. Various courts across the country have issued ­regulations or guidelines clamping down on “spreading rumours” about the ­illness. Meanwhile, the government has issued censorship orders on local media reporting about the crisis. The measures come amid ­escalating ­criticism at home and abroad of the communist regime’s mishandling of the outbreak, with ordinary ­citizens, experts, and ­commentators ­accusing it of masking the true scale of the ­crisis to maintain control over the social order.

A recent high court notice in the north-eastern province of Heilongjiang warned that anyone who spreads rumours about the outbreak to “incite separatism, harm national unity, or to subvert state power” may face a maximum of 15 years in jail. The court also stated that ­anyone who intentionally spreads the ­disease could face the death penalty, although it didn’t elaborate. On the other hand, China’s ambassador to the UK has said in a recent interview that he feels that people are unduly alarmist.

Third, connectivity. The municipal high court in Beijing said that it would support a crackdown on spreading rumours, as part of efforts to “safeguard social stability”. Recently, local police action against a group of “rumourmongers” in the virus’s ­epicentre of Wuhan drew a public backlash and rare criticism from the country’s highest-ranking court.

On January 1, officials in Wuhan had said in a statement posted on social media platform Weibo that they had “taken legal measures” against eight people who had “spread rumours” about the pneumonia-like disease, which “caused adverse impacts on society”.

“The internet is not a land beyond the law… any unlawful acts of ­fabricating, spreading rumours and disturbing the social order will be punished by police according to the law, with zero tolerance,” Wuhan police said. According to local media, the ‘rumour’ was a message posted on Chinese messaging app WeChat, by a local doctor on a chat group for alumni of his medical school. Li ­Wenliang told the group on 30 December 2019, that seven patients from a local seafood market had been diagnosed with a SARS-like illness and were quarantined at the hospital where he worked. His message came one day before Chinese authorities announced the detection of the new coronavirus and it is he who has since died of the virus.

So, in a world where we have ­welcomed connectivity as a sign of building a truly global village, where does this leave us? The ability of ­people to travel by sea and air brings a very much less welcome aspect, where disease can spread swiftly and is extraordinarily difficult to stop. We may have to reconsider the impact of airborne illnesses in the 21st century, spread by limitless travel opportunities and complex supply chains. The United States has already imposed an entry ban on anyone who has been in China in the last four weeks.

Experts are working swiftly to find a medical solution and in the last few days China has agreed to accept help from the US and other countries. Dr Richard Hatchett is the American head of the Coalition for Epidemic Preparedness Innovations (CEPI) set up three years ago and based in Oslo with a $1 billion five-year budget ­target. He said: “We are moving with unprecedented speed to deal with the first epidemic of its kind since CEPI’s founding”.

In China, Jack Ma, founder of e-commerce retailer Alibaba and one of ­China’s richest people, has donated Rmb 100m, the equivalent of $14m, of which almost half will be used in efforts to create a viable vaccine.

Whatever the outcome, many ­sectors will be affected, some of them in Scotland and the UK. Insurance policies are being re-examined for details of coverage, universities, hotels and travel companies are ­bracing for ­cutbacks with reduced ­bookings and cancelled flights, and sporting events and conferences have already been postponed, such as the World Athletics Indoor Championships, due to be held in China in March.

We may be inclined to over emphasise the dangers and impact of the coronavirus but there is a feeling that perhaps life will never be quite the same again.

Roddy Gow, chairman and founder, The Asia Scotland Institute.