Ebola could cost global economy $32.6B, World Bank says
Disease will cost billions even if it doesn't spread more than it already has
Ebola could cost the global economy over $32 billion by the end of 2015 if the viral infection spreads into countries that neighbour those already affected by the outbreak
That's according to the most recent estimates from the World Bank, the UN's global financial arm, which is tasked with handling loans to poorer nations.
To get the $32.6-billion estimate, the organization charted two scenarios.
- In the first, which they call the "low Ebola" scenario, the group assumed officials manage to contain the outbreak in the three most heavily impacted countries: Guinea, Liberia and Sierra Leone.
- In the second, known as "high Ebola," they assume the outbreak takes longer to get a lid on in those countries, and has meanwhile spread to new ones in the region.
In the first scenario, the financial impact might be limited to about $9 billion. In the latter, it would be more than $32 billion.
For context, the U.S. government estimates that the SARS outbreak in 2003 which killed almost 800 people and infected more than 8,000 cost the world economy about $40 billion.
Beyond the deadly and more serious human toll, one of the factors having an impact on Ebola's financial toll is what the World Bank calls “aversion behaviour,” or fear factor, whereby neighbouring countries close their borders to humans as well as commercial goods, and international airlines cancel flights.
David Evans, a senior economist at the World Bank and co-author of the report, said fear prompts flights to be cancelled, mining operations to halt, businesses to close, and farming and investment to slow as people try to avoid putting themselves and their employees at risk. That behaviour has a larger economic impact than sickness and death, he said.
"Closing borders and halting flights has a huge impact," he said. "These economies trade with the outer world. They have international investment in mining. Liberia imports food. So as we close borders and cancel flights, there is a real impact on the food security and the incomes of the households in these countries."
Minimizing financial impact
It's possible to minimize the financial impact if those types of behaviour aren't unnecessarily continued.
"The successful containment of Ebola in Nigeria and Senegal so far is evidence that this is possible, given some existing health system capacity and a resolute policy response," the World Bank said.
Part of the problem of the Ebola outbreak is it's attacking areas that already had insufficient and underfunded health-care infrastructure.
"The international community now must act on the knowledge that weak public health infrastructure, institutions and systems in many fragile countries are a threat not only to their own citizens, but also to their trading partners and the world at large," World Bank president Jim Yong Kim said.
The latest estimates from the World Health Organization indicates the Ebola outbreak, already the worst confirmed in the disease's history, has killed more than 3,400 people.
News on Wednesday emerged that the first victim to make landfall in the U.S., Thomas Eric Duncan, died in a Dallas hospital on Thursday morning.
It's worth noting that neither scenario considered the financial impact if the disease were to spread in any significant way to wealthier nations with much bigger GDPs. Under that scenario, the financial toll would presumably be much higher.
In a release, the World Bank also said it is mobilizing $400 million in emergency financing for the three countries hardest hit by the crisis.
With files from The Associated Press