Nicola Mawson
The latest outbreak in human metapneumovirus (HMPV), which was first detected in 2001 by Dutch scholars, is causing concern across the world as infection rates in China increase.
However, a local economist told Business Report yesterday that the current situation was cannot be used as an economic base-case as it was too soon to determine the extent of the epidemic.
The respiratory disease has recently caused many people to become ill, especially children, with reports emerging of Chinese patients queuing outside of hospitals and concerns in India that there may be a lockdown on the way.
Such news is reminiscent of the outbreak of the coronavirus (COVID-19) towards the end of 2019.
“There’s lots of uncertainty around this because we know that's how the COVID virus started and expanded relatively quickly,” said Johann Els, Old Mutual Group chief economist.
Els added that the HMPV seemed to be less severe than COVID, even though it has been spreading.
“I don't think we are in a COVID-type scenario; I think it's far too early to take this as a base case for one's economic outlook,” Els said.
“A risk that needs watching very carefully as it unfolds over the next days and weeks. So, I think it's far too early to become overly concerned about this. It's something to be watched.”
However, Els noted that China was South Africa’s biggest trading partner and any lockdown in China would have an impact on the local economy.
In 2022, as the global economy started emerging from the COVID-19 pandemic, total trade between China and South Africa was $57 billion (R1 trillion), a 35-fold increase from 25 years earlier.
China’s economy grew around the 4.5% mark last year, with final gross domestic product figures due out in the next few weeks, said Els.
“For 2025, growth will likely again be around 4.5% to 5%,” he said.
Els added that the Chinese government has been providing policy support to bolster the economy, with more expected, due to its low inflation rate. As of December 9 last year, China’s inflation rate was 0.2%, lower than the long-term average of 1.62%.
Moreover, the situation in South Africa is different when compared to 2019 and 2020 given increased confidence following the formation of the Government of National Unity, said Els.
Els noted that there was a low probability of a global lockdown, which would adversely affect global growth, although this is “something to be watched,” although he did not expect anything “too severe”.
BUSINESS REPORT