As China's neighbor and key trade partner, Japan reported 135 cases of the H1N1 virus yesterday, leading economists to express worry that China will soon suffer from the deteriorating Japanese economy.

And though the Ministry of Health refused to comment yesterday on the spread of the virus in Japan, Cui Xiaobo, a health expert with the Beijing Municipal Government, noted that China hasn't taken any special measures against countries reporting flu cases, including Japan.

As of Friday, Japan officials thought they had kept the virus at bay. Four people from North America who had tested positive for the virus were immediately quarantined, as were 50 of their fellow passengers.

People in Ibaraki, a suburban city of Osaka, Japan, wear face masks yesterday. According to the latest figures from the Japanese Ministry of Health, Labor and Welfare, there were 135 confirmed cases of the H1N1 virus as of 8 pm yesterday, mostly in Osaka and Hyogo. More than 1,400 educational institutions in two prefectures suspended classes on the request of local governments. (Photo: Xinhua)

The spread of the virus is posing another stiff test for China's economy, as tourism, exports and aviation continue reporting dismal figures. But Chinese economists note that the overall economic impact of the flu has been temporarily contained.

Chinese Minister for Tourism Shao Qiwei predicted last month that the number of Japanese tourists coming to China would increase by 40 to 60 percent between April and June, but Sun Lijian, a professor at Fudan University, told the Global Times yesterday that amid the widespread fear of the flu in Japan, travel plans will be canceled to a considerable degree, and business travel could be delayed

The outbreak has undeniably impacted the world economy, which is still reeling from the recession, but the psychological impact is greater than the real impact, according to Chen Fengying, the leading economist at the Chinese Contemporary International Relations Institute, who spoke to the Global Times yesterday.

"The impact on China's economy is slight and controllable for now," Chen said, adding that the trade between China and the US remains stable.
"If the condition of the flu gets worse," Chen warned, "China's economy may stagger, and the whole world will suffer."

Zhang Minghou, deputy general secretary of the China Hotel Association, told the Global Times yesterday that the virus has affected people's willingness to travel.

Xu Shuzheng, an executive director of the tourism center for Chinese citizens at the China Taihe travel agency, said that preliminary estimates indicate that company's outbound customers have postponed their tours, and 10 percent simply canceled their plans out of fear of the flu.
But domestic tourism hasn't shown much change compared with the same period last year, according to Xu. "Most travelers are officials, retirees and people on annual vacations. They are more calm and rational about the flu, so domestic tourism is relatively stable," he said.
And the impact on restaurants is much less than on hotels, as dining patrons are mainly locals, with tourists making up just 10 percent of the business, Zhang noted. Most restaurants in Beijing were closed during the SARS outbreak in 2003, but they haven't seen any sign of losing clients now.

Hong Kong, with three confirmed flu cases, appears to have been harder hit in terms of tourism. New figures released by the Hong Kong Tourism Board showed 9 million people visited the region in the first four months – 1.4 percent more than the same period last year – but the number of visitors has declined 9 percent since the flu outbreak.

"The situation is even more serious than the period of SARS in 2003," Ronnie Ho, chairman of the Travel Industry Council of Hong Kong, recently told the local Wen Wei Po newspaper.

In order to save money, some travel agencies in Hong Kong have imposed a forced holiday of one or two weeks on their employees, according to Ho.
Meanwhile, Li Hancheng, executive director of the Federation of Hong Kong Hotel Owners, said none of the star-rated hotels have been spared from the impact of the flu. The occupancy rate is now less than 50 percent – down at least 20 percent, year-on-year.