How The Coronavirus Began
The Coronavirus, also known as the COVID-19, is a deadly virus that began to surface in Wuhan, China in December 2019. Scientists are still trying to determine how the virus pathogens have been passed onto humans. At first, it was thought that it was passed from animals to humans, but that has not been confirmed.
COVID-19 Spreads Internationally
The COVID-19 has now been confirmed in many other locations around the world including Canada.
Affects of the Coronavirus on Canadian Economy
Many Canadian companies rely on China for raw materials, small components, products, and tourism. Businesses are beginning to feel the impact of the virus, the full effects on Canada’s economy will be felt in the coming months. The hardest-hit industries will be airlines and manufacturing.
The COVID-19 virus is expected to have a larger impact on the Canadian economy than the SARS virus. This is due to Chinese manufacturing increases since the SARS outbreak in 2003.
Canadian Products With Components From China
In Canada, the manufacturing industry will be hit hard. Many Canadian products rely on components, ingredients and raw materials to produce their products. Some companies even rely on China for constructing a portion of their products. Without product or service from China, many Canadian products will not make the shelves in stores. If they don’t have a finished product, then they cannot sell them. This will directly affect their revenue and can incur huge losses.
China Products From Raw Materials Received From Canada
Some manufacturers send raw materials to China, China completes the production and sends it back to Canada. This process has slowed down also due to many factories in China being shut down due to the coronavirus.
Global Supply Chain
The global supply chain is much more complex than it was during the SARS outbreak in 2003. China’s economy is four times larger than it was it 2003, making it the second-largest in the world. For some Canadian companies, it can be as simple as waiting for a product label before they can sell their products. Without the label, the product cannot be sold.
Canadian Tourism and Travel
The coronavirus will hit Canadian tourism very hard. Many Chinese visitors come to Canada every year. Approximately 700,000 Chinese visitors come to Canada each year. Niagara Falls and Toronto are prominent destinations. Gravenhurst, Ontario is another popular tourist destination for the Chinese population. This is due to the fact that a national historic site called the Norman Bethune House is located in Gravenhurst. Norman is considered a hero in China as he was a great surgeon, political activist, and inventor.
Canada has released warnings about travelling to China and the Hubei province as this is where the center of the outbreak is. China has also imposed very strict travel restrictions on its citizens. Canadian Chinese families are not travelling to China to visit family. This directly affects airlines and tourism in both China and Canada.
Core industries such as food and beverage, transportation, travel services, accommodation, and recreation and entertainment will be hit the hardest. Industries such as insurance, banking, fishing, and agriculture will also be greatly affected by the coronavirus outbreak.
There are many things that can affect the Canadian economy both in a positive and negative fashion. It is important to be aware of these.
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