Asia Minute: South Korea Faces Growing Costs of MERS Crisis
The World Health Organization says there’s no need for anyone to restrict travel to South Korea because of medical concerns. But many travelers have been changing their plans, and that’s just part of the continuing cost of the MERS virus. HPR’s Bill Dorman has more in today’s Asia Minute.
Middle East Respiratory Syndrome—MERS—is taking a heavy toll on South Korea’s economy.
Nearly two hundred people have been diagnosed with the disease…nearly 30 have died.
South Korea’s Health Ministry says nearly all the cases have been traced directly to hospitals. On Wednesday, two Seoul hospitals announced they’re suspending services to try to help stop the spread of the virus.
The Korea Tourism Organization says more than 120-thousand people cancelled trips to South Korea over the first 18 days of June…most of them from China.
Strategists for HSBC Holdings say many Chinese travelers who were planning to go to South Korea changed their itineraries to instead head to Japan…which also has a better exchange rate and recently eased visa policies for Chinese visitors.
South Korea’s central bank has slashed its benchmark interest rate to a record low because of the economic impact of MERS. And a lawmaker with the ruling party told reporters Wednesday, the government will put together a supplementary budget of 9-billion dollars for the same reason.
Moody’s Investors Service wrote in a recent client note that MERS is threatening South Korea’s fragile economic recovery…hurting not only tourism, but also consumer confidence and household spending.