The hot news topic around the world for the past couple months has been the spread of Ebola throughout west Africa -- and recently onto U.S. soil. As a deadly outbreak of this potential has not occurred in generations, it scares a large percentage of the population in the U.S., despite the fact that only one person has died (as of today). For this reason, I thought it would be interesting to look into the economic implication of the Ebola outbreak.
According to Forbes, Ebola has already accounted for over 4,000 deaths and counting - with most deaths occurring in Liberia, Guinea, and Sierra Leone (Forbes). From an economic perspective, the International Monetary Fund has estimated that the Ebola outbreak will shave more than 2% off of the projected 8% growth rate this year, with estimates at 3.5%. This would obviously be devastating to the small country, which post-conflict has experienced relatively strong growth. This economic impact is mostly driven by the quarantine of the country's in the region, with many exports halted, including rubber, oil palm and iron ore. This has led to concerns that government revenues will fall and that foreign exchange shortages could be impending, especially concerning for a government with such a small budget already. With so much money already being invested in the healthcare sector in order to combat the spread of this disease, the governments in the region have been less puzzled as to what actions to take.
This is something that we must plan ahead for in the United States, as policy makers must begin to take preventative actions in order to prepare for what could be the impending economic impacts. I believe the best way for us to prepare is by increasing health care research spending on Ebola cures and vaccines. Furthermore, we should prepare a provisional budget which would account for the potential economic costs of decreased taxed dollars and increased public health spending that would be associated with an increased outbreak in the United States. Though Ebola may just seem to be the hot topic, it is a topic that carries serious potential economic implications on our home soil, and is therefore something that must be analyzed by policy makers.
Sources:
http://www.forbes.com/sites/jvchamary/2014/10/13/ebola-trends/
http://www.economist.com/blogs/baobab/2014/09/costs-pandemic
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