Businesses in B.C. 'feeling the pinch' of coronavirus outbreak on global markets
Wide sector of industries affected — from manufacturing to tourism
Businesses in British Columbia are bracing for an economic downturn as global trade sputters with the ongoing spread of the novel coronavirus, with industries from manufacturing to retail to tourism all impacted.
Globally, as of Wednesday, there are 93,164 cases of COVID-19 and 3,199 deaths, according to the World Health Organization (WHO). China, South Korea and Italy have been the hardest hit, but the financial impacts are already reverberating in B.C.
"We're seeing a lot of concern and shortages of different supplies," said Anita Huberman, CEO of the Surrey Board of Trade.
"When we see manufacturing in China right now being shut down or stalled — well, we're just waiting to see what happens in other markets."
Surrey has the largest number of manufacturers in B.C., according to Huberman, with many of those companies exporting and importing products globally. And many are already "feeling the pinch" of markets drying up.
"China is a significant market for trade, not only for Surrey but for all of B.C. in terms of the Asian Pacific Gateway," she said.
"Manufacturers are feeling bottom line impacts."
'We're on hold'
Wendy Matthews runs NeverLand Farm, a small soap-making and natural body products business based in Mission. She was in the midst of scaling up her business, with plans underway to export her products to China this year.
Now, those plans have ground to a halt.
"We're on hold. There is absolutely nothing that we can do, it's in complete lock-down according to the exporter," Matthews said.
Had she launched her export plans, Matthews says she was looking at increasing her revenue to about $15,000 per month — double what her business made last year.
That would have allowed her to quit her current job to focus on the soap business and hire other employees, including her husband and at least one of her daughters, to grow the family business.
"It's filtering down to little mom-and-pop businesses that are just starting out," she said.
Matthews plans to continue making soaps to sell them locally until things settle.
"You take it as it comes, nothing in life is guaranteed," she said.
'Mostly the uncertainty'
Daniel Fields, a senior economist with the Conference Board of Canada, says businesses that rely on global movement — like trade and tourism — are most impacted.
China is the second-largest long-haul market for Canada-bound tourists, with many of them arriving in Vancouver, and Fields says the province is expected to take a $250-million hit from lost tourism revenue.
But, he added, the province's economy isn't in dire straights yet.
"The rest of the economy is doing pretty well, so it will be a matter of how long will this go on for," he said.
"It's mostly the uncertainty right now, to be honest."
The Bank of Canada announced Wednesday it is cutting its key interest rate target by half a percentage point, dropping it to 1.25 per cent in response to the potential economic shock from the coronavirus outbreak.
Fields says not to panic yet, though.
"It's going to be interesting times, with some smaller impacts but we don't necessarily expect a recession," he said.
Click on the audio below to hear more about the economic impacts of coronavirus:
With files from B.C. Today