The World Bank estimated China's SARS-related losses at $14.8 billion. Most analysts say the current outbreak of Ebola is a poor second in this respect – it’s unlikely to deal a major blow to global economy and even the World Bank’s worst-case scenario for West Africa represents a tiny drop in the world economy.
“In my particular view, SARS had hurt the global economy the most,” Jose Luis Chalhoub Naffah, head of BYBLOS Consulting said.
Most of China was essentially on lockdown in the first half of 2003 as the government did everything it could to minimize human-to-human contact. Discos, bars, shopping malls, indoor sports facilities, and movie theaters were closed, while 80 percent of five-star hotel rooms vacant.
According to a study by the London School of Hygiene & Tropical Medicine, SARS-related losses in the tourism, food and travel industries totaled $8.5 billion in mainland China and $1.3 billion in Hong Kong, and also $4.3 billion in Canada, which was far from the outbreak’s center but has a large diaspora of Hong Kong Chinese. Asia-Pacific carriers saw their revenue plunge $6 billion, while North American airlines lost another $1 billion.
It's not surprising that a pandemic hurts businesses dependent on employees or customers moving from point a to point b, but SARS also set back transport companies such as FedEx due to closed airports, or fewer people doing business; telecom equipment-makers such as Nortel because of vendors and customers staying home, and even cable-TV-box maker Scientific-Atlanta as it orders multiple parts to be made in Asia.
It even cut deeply into profits for Estee Lauder, which under normal circumstances sells a lot of cosmetics in Hong Kong, Singapore and China, and in duty-free airport shops. Finally, the net revenue of Park Place Entertainment, owner of Caesar's Palace in Las Vegas and other gambling and hotel complexes, plunged more than 50 percent in the second quarter of 2003 compared with the year before. This was mainly because Asian high rollers hunkered down rather than risk infection while traveling.
“When it comes to measuring economic impact of a disease or a pandemic and its threats to investment, it’s not debts or periods away from employment, but disruption of markets caused by a loss of confidence and changes of patterns of investment which matter.”
But as research to understand the indirect costs of an epidemic has been growing, economists who study pandemics still worry they may be underestimating the financial toll because they haven't been considering all the ramifications.
