How the China coronavirus travel ban is a $16BILLION disaster for Australia's economy - with 200,000 international students and 1.4 million tourists locked out of the country - and it could plunge us into recession
- Chinese students, tourists pump $16 billion into Australian economy each year
- At least 200k students, 1.4 million tourists visit the country - now plans in chaos
- Travel ban response to the coronavirus outbreak will last for at least two weeks
- Treasurer Josh Frydenberg has admitted coronavirus will be a 'significant' hit
- Mr Frydenberg compared impact to SARS - which was far less widespread
The China travel ban is a massive financial blow to Australia as Chinese students and tourists pump $16 billion into the economy every year.
Coronavirus fears saw the ASX plunge by almost two per cent on Monday, the first day of trade since Prime Minister Scott Morrison announced his travel ban.
Mr Morrison took the drastic action at the weekend in response to the deadly virus's spread around the world. The illness has infected more than 17,000 people and been declared a global health emergency.
The Federal Government has banned any traveller from China who is not an Australian citizen, resident or their immediate family member from entering the country.
More than 200,000 Chinese students attend schools and universities in Australia and 1.4 million visit the nation each year.
They now have nowhere to go.
More than 1.4 million Chinese tourists visit Australia each year but the coronavirus travel ban has barred them from entry for at least two weeks
Worldwide fears: A passenger has his temperature checked by staff at an airport in Japan
Universities, schools, student accommodation providers, hotels, restaurants, tourist operators and airlines are bearing the brunt of ban, which may last for longer than a fortnight if the outbreak worsens.
In an interview with the ABC, Treasurer Josh Frydenberg admitted virus fears will cause a 'significant' hit to the economy. 'China's a critical economic partner for us,' he said.
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But treasury boffins have told Mr Frydenberg that it is 'too early' to tell how badly the possible pandemic will affect the economy - or whether it could push the country toward recession.
Treasurer Josh Frydenberg said it was too early to tell what impact the coronavirus will have
Professor Tim Harcourt, a fellow at the University of New South Wales business school, said: 'The main impact, short term, is on tourism and education'.
Prof Harcourt said the country could expect a quarter of negative growth - halfway to a recession, which is defined as two quarters of consecutive negative growth.
Education industry officials said the travel ban could cost their industry alone up to $8 billion in the worst case scenario.
Phil Honeywood, who is coordinating the education sector's response, told ABC News Breakfast the ban's impact goes beyond university-age Chinese students to schools, student accommodation, popular English language colleges and international TAFE students.
The escalating crisis has been worsened by timing of the outbreak - coming over the Lunar New Year holiday when many Chinese students are holidaying back home.
The education sector (stock image) is bracing for a loss of up to $8 billion should the situation continue to worsen in China
'Some (students) have even contacted me indicating they have pets in boarding kennels because they went home for Chinese New Year,' Mr Honeywood said.
The ban has affected some long term students, who are 'two years into a three year degree and can't come back'.
Meanwhile, the tourism industry - already groaning under the strain of the nation's summer bushfire crisis - has reportedly forecast a $1 billion loss for each month the ban continues.
Chinese tourism brings in about $12 billion a year onto Australian shores and businesses have reported waves of cancellations.
Restaurant and Catering Association chief executive Wes Lambert told Melbourne's The Age: 'Some members have told us they have gotten calls from some of their tourism operators that have had cancellations in the hundreds of thousands.'
Prof Harcourt said many of the about 6000 Australian small and medium sized businesses dependent on China will experience some pain.
'If you're selling wine into Qingdao, you're going to put off your travel,' Dr Harcourt said.
The local seafood industry has also ground to a halt after China shut down its live animal trade, after the disease apparently began in 'wet' Chinese markets in Wuhan.
But Prof Harcourt said the main drivers of Australia's trade - commodities such as coal and iron ore - would continue to bubble along.
'Rocks and crops - minerals and agriculture - that will continue and they're our lion's share of trade,' he said.
'Those things are really strict in terms of customs and quarantine'.
The 'lion's share' of Australian trade - minerals and agriculture - will continue. A coal ship at Newcastle port is seen above
At the weekend, Treasurer Frydenberg compared to economic impact of the coronavirus to the damage SARS did to the economy in 2003.
SARS, or Sudden Acute Respiratory Syndrome, spread around the world from animals in late 2002.
Fears of infection led Chinese student numbers, tourist numbers to fall 11 per cent and a blip in trade.
But, under questioning, Mr Frydenberg conceded Australia's economy is now far more entwined with China's than it was in was 17 years ago.
Meanwhile, the number of coronavirus cases has already surpassed the number of SARS infections.
SARS infected 8,100 people over an eight months. 12,000 people have been diagnosed with the coronavirus since December.
