And he added that while the precise impact is unclear, it could be “significant.”
Morneau gave the keynote address at a meeting of the Economic Club of Canada in Calgary, Alta., on Monday morning.
In that speech, he addressed the ongoing outbreak, which has sickened 40,171, mostly in China, and killed roughly 908 others, surpassing the death toll from the 2003 SARS epidemic. Two deaths have been reported outside mainland China, while more than 20 countries, including Canada, have confirmed cases of infection.
“The virus is undoubtedly going to have an economic impact,” Morneau told attendees at the gathering, adding that he expects the outbreak will be a “central topic” at upcoming meetings of G20 finance ministers and central bankers later this month.
While he said “we can’t know what the economic impacts are right now,” Morneau said the impact will be felt across Canada on everything from declining tourism, dropping oil prices and supply chain challenges.
He also added that some estimates suggest the outbreak could cause a dip of roughly four per cent in global economic output in 2020.
“We need to keep that in the context of an economy, globally, that’s growing at around three per cent, so it’s a significant impact,” Morneau said.
He pointed in particular to impacts on supply chains and any business with close supply chain ties with China.
The city of Wuhan in Hubei province is considered the epicentre of the outbreak.
It is also an industrial region home to many factories making, among other things, automobiles and the crystal display screens used in products like televisions.
But the city itself has been on lockdown for weeks now, with its 11 million residents confined to their homes in an unprecedented quarantine.
Some 50 million others in surrounding cities are also facing heavy travel restrictions as Chinese officials grapple to contain the spread of the virus.
The Canadian government has evacuated roughly 211 citizens and permanent residents from Wuhan over recent days and is set to evacuate more on Monday.
Evacuees so far are being housed at the Canadian Forces Base Trenton, where they are to remain in quarantine for 14 days.
Parts of China are locked down as the coronavirus spreads. What does that mean for the global economy?
More to come.
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