Economic implications of coronavirus

• Published date: 01 November 2020
• Author: Mohd Imran Siddiquei,Waseem Khan
• Date: 01 November 2020
• DOI: http://doi.org/10.1002/pa.2169

PRACTITIONER PAPER

Economic implications of coronavirus

Mohd Imran Siddiquei|Waseem Khan

Institute of Business Management, GLA

University, Mathura, Uttar Pradesh, India

Correspondence

Mohd Imran Siddiquei, Institute of Business

Management, GLA University, Mathura, UP

281 406, India.

Email: imran_siddiquei@yahoo.co.in

The world is grappling with unexpected and unknown financial crises by a deadly

Coronavirus. Everyday news is coming up with a further spread of Coronavirus with

more number of deaths and infections, nearly 190 countries and territories have

reported Coronavirus cases. Adverse effects of this lethal virus have been experienc-

ing in developed and developing economies equally. Travel and tourism, hospitality,

food and beverage sector, and stock market are severely impacted. The article

attempts an in-depth analysis of how the disease is affecting transport, hospitality,

food and beverage, and the stock market.

1|INTRODUCTION

The Coronavirus first observed in the Wuhan city of China in

December 2019 and thereafter spread in the whole world, till

March 2020, more than 39,000 people have been dead. The dis-

ease has started from the seafood market of Wuhan city, where a

lot of wild animals like rabbits, bats, snakes, civets, and so on are

traded. The culture of eating wild animals is quite old in China,

where these animals have been considered delicacies. The Wuhan

market has been suspected as an epicenter of this disease with a

large number of patients having a history of visiting this market.

The World Health Organization has declared it a health emergency

and named it as COVID 19. The virus has the potential to impact

the entire world in a monetary and nonmonetary term, this danger

has been considered “very high”by the World Health Organization

as well as other World Bank. However, China has effectively coun-

ter Coronavirus with a large number of proactive actions, but the

grim scenario is emerging in European countries such as Italy,

Spain, France, and Germany where the virus is spreading exponen-

tially. Now Europe has become the new epicenter of Coronavirus.

Apart from European countries, Iran and USA are also facing

severe consequences of this deadly virus.

The threat of Coronavirus is hovering all over the world, govern-

ments across the countries are trying their best to fight with it, but its

impact is too huge. Apart from its impact on life, the economic conse-

quences are also very severe, according to the OECD, it may prove to

be the biggest threat to the world economy. The virus has thrown the

entire tourism sector into chaos, affected production and productivity,

supply chain, stock markets, as well as economic fallout between

nations, businesses are losing revenue, factories are closed in China,

and millions of people are locked in their homes. As Coronavirus has

hampered economic activities, it is imperative to examine the detailed

consequences of this virus on economy. In light of ongoing develop-

ment, the article will describe the implications of Coronavirus in vari-

ous sectors of the economy.

Coronavirus has affected the entire Chinese economy and

because China is the second-largest economy in the world, its spill-

over effect is being s een all over the world. The growth rate o f most

of the sectors in China has come down but the service center has

been affected the mos t. Some sectors of the economy are sufferi ng

significantly due to Coronavirus such as transport, hospitality, and

food and beverages. Multinational companies are allowing their

employees to work from home to stop the spread of this virus. But

this drastic measurehas various negative economic consequences.

However, it is not feasib le to work from home in every sector while

some companies are asking their workers to go on leave

without pay.

2|IMPACT OF CORONAVIRUS ON

TRANSPORT SECTOR

Governments across the countries have issued an advisory to their cit-

izens to avoid unnecessary travel to stop the further spread of the

Coronavirus, many countries have canceled the visa of passengers

belonging to Coronavirus prone countries. Due to the fear-mongering

environment, people are afraid to travel, due to all these reasons, the

transport sector is about to lockdown. According to the International

Air Transport Association, the aviation industry may lose between

63 billion dollars and the broad impact can go to 112 billion dollars.

Received: 11 March 2020Revised: 31 March 2020Accepted: 28 April 2020

DOI: 10.1002/pa.2169

J Public Affairs. 2020;20:e2169.wileyonlinelibrary.com/journal/pa© 2020 John Wiley & Sons, Ltd1of3

https://doi.org/10.1002/pa.2169