It is estimated that one deadly strain of avian influenza caused the deaths of 50 million people worldwide. In England it was named Spanish Flu. It broke out here in 1918 so towards the end of First World War.
The current outbreak of Wuhan Virus is being taken very seriously but so far represents just a tiny fraction of the human cost that the pandemic of 1918 incurred. However the big issue that most commentators are not addressing is the disproportionate impact that the quarantine measures are going to have on world trade – and the global economy. In effect the entire world’s factory has been all but closed.
Each week that a factory in China, normally producing goods for export, remains closed around 2% of its annual production is lost. How many factories in China are already closed? And how many more will follow? How long before they can re-open?
Now we can all survive if the launch of the latest smartphone is delayed for months or even years. But the mighty Apple will soon feel the icy blast of recession if it runs out of products to sell. And it’s not just factory products impacted. At the opposite end of the process raw materials like coal, oil, iron ore, etc will experience a big drop in demand. This in turn will lead to a drop in prices and lay-offs in countries far away from the regions infected by the Wuhan virus.
There is a serious risk that there will be a collapse in world trade – and perhaps one big enough in scale to surpass the Wall Street Crash of the 1920’s … And that is yet another piece of 20th century history that no one wants to see repeated.