COVID-19 impact on B.C.’s economy uncertain: finance minister

WatchThe financial costs of COVID-19 are a growing concern. This morning financial markets tumbled, and the US federal reserve resorted to cutting interest rates. Closer to home, BC's finance minister says she expects some impact on the provincial economy. Mary Griffin reports.

With the likelihood of more COVID-19 cases to come in this province, B.C. Finance Minister Carole James said the economy will be impacted, it’s just not clear by how much.

“We’re certainly monitoring. It’s a little early yet to quantify. But we’re monitoring, reports and updates. We’ll be discussing this issue, of course, with colleagues across the country, I expect as well,” James said.

READ MORE: Victoria tourism industry starting to see a hit from coronavirus outbreak

If the virus continues to spread, a number of sectors in B.C.’s economy will be impacted by a global slowdown according to the dean of UVic’s Gustavson School of Business, Dr. Saul Klein.

“For an economy like ours, the impact is going to be quite strong, and quite sharp,” Klein said.

Elsewhere, in response to a growing economic threat from novel coronavirus, the U.S. federal reserve chair Jerome Powell announced an emergency interest rate cut.

It’s the biggest in more than a decade.

“We can and will do our part, however, to keep the U.S. economy strong as we meet this challenge,” Powell said.

READ MORE: Three more cases of novel coronavirus in British Columbia, all linked to Iran

The hits to the global economy keep coming. Tech giant Google has cancelled its largest annual event over COVID-19 fears.

In Ottawa, Prime Minister Justin Trudeau says he knows the challenges ahead.

“There are a number of countries that have made different choices. But we are confident in Canada, what we continue to do in Canada is right for Canada,” Trudeau said.

Klein said if the number of cases continues to climb, the B.C. economy will start to feel the effects.

That includes the retail sector as people avoid crowds in shopping malls. And expect a drop in the number of international students coming to BC and Vancouver Island.

A recession is not out of the question.

“That’s really about timing and how long the situation continues,” Klein said.

“If in six months’ time, we’re still looking at the same conditions that we have today with a significant slowing down in the global economy, then it becomes a very real event.”

The full impact may not be known for months, but it is already disrupting economies around the world.


Mary GriffinMary Griffin

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