The Middle East respiratory syndrome (MERS) outbreak has been ongoing in South Korea since May 2015. It could reduce South Korea's economic growth in 2015 by up to 0.3%, as it causes drop in tourism and consumption, revealed a report by Japanese investment bank Nomura. The report calculates South Korea's gross domestic product (GDP) will grow by 2.2% this year instead of 2.5% due to the MERS outbreak in the country. The report says that reduction in private spending could generate losses of around 0.2% in the GDP.
The MERS coronavirus outbreak has led to panic among the people to the extent that many avoid going out on the streets or crowded places, leading to a huge fall in sales and consumption, from supermarkets to cultural centers and leisure spots. Moreover around 110,000 foreign tourists, mainly from China, Japan and Taiwan, have cancelled their trips to South Korea over MERS fears, causing losses in tourism-related sectors such as airlines, tour agencies and services in general.
AdvertisementThe Nomura report estimates a reduction of around 300,000 foreign tourists till August, 2015, which would bring down South Korea's GDP growth in 2015 by another percentage point.
The death toll due to the MERS virus is 19, while the total number of infections in the country are about 154. Additionally, 5,580 people have been quarantined.