China's massive economic power shapes global response to coronavirus outbreak

Travellers wearing facemasks arrive from various provinces at the Beijing Railway Station on Feb 3, 2020. PHOTO: AFP

BEIJING (BLOOMBERG) - As countries around the world enact measures to stop the spread of the deadly coronavirus outbreak that originated from central Chinese city of Wuhan, there's an additional factor shaping their response: China's enormous economic clout.

While wealthy countries such as the US and Australia - both key trading partners of China - are currently barring entry to all non-resident travellers from the mainland as the virus spreads and fatalities rise, less developed countries that rely on Beijing are taking a softer approach as they balance public health concerns, the potential economic fallout and domestic political consequences.

Particularly in countries where China is the biggest trading partner and largest source of inbound tourists, moves that restrict the flow of mainland visitors could end up hurting growth. Restrictive measures also risk angering Beijing's officials as they battle the outbreak and try to avoid further damage to China's global image.

"Countries imposing travel restrictions on China will try to carefully manage any potential political tensions," said Mr Kaho Yu, a senior Asia analyst at risk consultancy Verisk Maplecroft.

"A serious pandemic threat - a potential outbreak in these countries - will have an impact on their domestic politics, such as elections, and would transcend geopolitics," he added. "But these countries are also very careful with how they present the travel restrictions, in order to avoid upsetting Beijing and having geopolitical consequences."


China has already made its displeasure known over some travel restrictions, which have not been advised by the World Health Organisation (WHO).

The acting Chinese ambassador to Israel compared the country's travel restrictions on Chinese visitors to Jews being turned away at borders during the Holocaust. The embassy later apologised, the Associated Press reported.

After the US State Department issued its highest do-not-travel alert for China - on par with Iraq and Afghanistan - Chinese foreign ministry spokeswoman Hua Chunying said "the US comments and actions are neither based on facts, nor helpful at this particular time."

In a briefing on Monday (Feb 3), Ms Hua blasted the US for being the first to withdraw consulate staff from Wuhan and announce a travel ban on Chinese citizens.

"The WHO doesn't approve of, and even rejects, travel and trade bans on China," Ms Hua said. "In the face of a public health crisis, countries should work together to overcome the difficulties, rather than resort to beggar-thy-neighbour practices - let alone take advantage of others' difficulties."


Some poorer countries with close relations with China, such as Cambodia, have explicitly emphasised the potential economic and diplomatic damage from a ban on visitors.

As President Xi Jinping's most reliable partner in South-east Asia, the Cambodian government has attracted around US$8 billion (S$10.96 billion) from China between 2016 to August 2019, more than a third of its foreign investment, according to the official Xinhua News Agency.

Banning flights to China would "destroy the Kingdom's economy and affect the good relationship between the two countries," Cambodian Prime Minister Hun Sen's office said in a statement.

Cambodians "who are currently working or studying in China, including those in Wuhan, have to remain there and join the Chinese people to fight this disease," Mr Hun Sen said during a speech in Phnom Penh on Jan 30, according to Voice of America. "Don't run away from the Chinese people during this difficult time."

Pakistan, a key Chinese diplomatic and military ally, cancelled flights to China but quickly resumed them after just five days in line with WHO guidelines, according to Mr Zafar Mirza, a special assistant to Pakistan's prime minister on health.

He added that China's health plans were "the best" and, as a neighbour, Pakistan needed to "respect their policies."

China has invested billions of dollars and exports military hardware to Pakistan. The Muslim-majority country's prime minister, Mr Imran Khan, has repeatedly declined to comment publicly on the condition of China's Uighur Muslims. As many as a million of them are detained in prison-like camps in China's far west region of Xinjiang.

Sri Lanka, a major recipient of Chinese loans and investment, even praised "great diplomatic relations" with China for allowing evacuations of their citizens.

For many dependent on China's trade, investment or tourism - including jurisdictions such as Hong Kong, which are under pressure from residents to implement wholesale travel bans - there is an additional risk: Once a restriction is in place, it could prove very difficult to reverse it. And with the virus predicted not to peak for months, that could have huge consequences.

"Once these measures are in place, they can be sticky - they can take a long time to rescind," said Mr Yanzhong Huang, who directs the Centre for Global Health Studies at Seton Hall University and is a senior fellow for global health at the Council on Foreign Relations. "And that can cause economic damage, not just to China but to the countries that implement these measures - and it could be a lose-lose situation."


While China has criticised the US response, including an entry ban on any foreign national that has been to China in the last two weeks, several South-east Asian countries have taken more stringent precautions.

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The Philippines, which saw the first death from the virus outside of China, is banning visitors from all of China, including Hong Kong and Macau, and also prohibiting Filipinos from travelling to those areas. President Rodrigo Duterte said the move was to prevent the spread of the outbreak, and slammed "xenophobia" from people blaming China.

"We are a community of nations - we cooperate," Mr Duterte told reporters Monday night. "China has been kind to us. We can only also show the same favour to them."

On Friday, Singapore suspended the visas of Chinese citizens wishing to travel to the city-state. At the same time, it imposed a similar restriction on any foreign national having recently visited China.

Singaporean Prime Minister Lee Hsien Loong said on Saturday the restrictions were "purely to protect our public health" and complementary to China's border control efforts, local media reported. He denounced anti-Chinese sentiment, and said all countries must work together to stop the outbreak.


Myanmar, which currently has no confirmed cases of the virus, announced a temporary ban on all visitors from China while also evacuating 59 students from Wuhan over the weekend.

The government "always prioritises the national interest while trying to maintain our good relationship with China," said Mr Monywa Aung Shin, a spokesman for the ruling National League for Democracy party.

While Thailand on Monday remained one of the few South-east Asian countries not to bar Chinese visitors, Health Minister Anutin Charnvirakul said in a briefing on Friday that his priority was to stop the spread of the disease.

"The economic standpoint is secondary," Mr Anutin said, adding that travel from China is already down by 80 per cent and that there was no need to ban travel or curb visas for Chinese citizens. "We need to keep our house clean," he said. "If not, the economic impact could be devastating."

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