China’s Massive Economic Power Shapes Global Response to Virus
(Bloomberg) -- As countries around the world enact measures to stop the spread of the deadly coronavirus outbreak, there’s an additional factor shaping their response: China’s enormous economic clout.
While wealthy countries such as the U.S. and Australia -- both key trading partners of China -- are currently barring entry to all non-resident travelers 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 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 Organization. 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 apologized, the Associated Press reported.
In a briefing on Monday, Hua blasted the U.S. 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,” Hua said. “In the face of a public health crisis, countries should work together to overcome the difficulties, rather than resort to beggar-thy-neighbor practices -- let alone take advantage of others’ difficulties.”
Some poorer countries with close relations with China, such as Cambodia, have explicitly emphasized the potential economic and diplomatic damage from a ban on visitors.
As President Xi Jinping’s most reliable partner in Southeast Asia, the Cambodian government has attracted around $8 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,” 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, canceled flights to China but quickly resumed them after just five days in line with WHO guidelines, according to 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 neighbor, 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, 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 Yanzhong Huang, who directs the Center 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 criticized the U.S. response, including an entry ban on any foreign national that has been to China in the last two weeks, several Southeast Asian countries have taken more stringent precautions.
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 traveling 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,” Duterte told reporters Monday night. “China has been kind to us. We can only also show the same favor 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, Today Online reported. He denounced anti-Chinese sentiment, and said all countries must work together to stop the outbreak.
“We wish China well in their efforts to fight the virus,” Today quoted Lee as saying. “We have confidence that China and the other countries will work together to win this battle.”
‘Keep Our House Clean’
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 prioritizes the national interest while trying to maintain our good relationship with China,” said Monywa Aung Shin, a spokesman for the ruling National League for Democracy party.
While Thailand on Monday remained one of the few Southeast 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,” Anutin said, adding that travel from China is already down by 80% 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.”
©2020 Bloomberg L.P.