By the Blouin News Business staff

Spread of bird flu harms Taiwan’s economy

by in Asia-Pacific.

Public health workers cull geese to help prevent the spread of avain flue in Taoyuan, Taiwan, January 17, 2015. SAM YEH/AFP/Getty Images

Public health workers cull geese to help prevent the spread of avian flue in Taoyuan, Taiwan, 1/17/15. SAM YEH/AFP/Getty Images

Local Taiwanese officials confirmed on Monday that the recent outbreak of avian flu has spread across the country to the eastern half despite efforts to stop it. This belies a separate statement on Monday from agricultural officials that the outbreak, Taiwan’s worst in the past ten years, is under control. Since the bird flu outbreak began in December, it has spread rapidly, and over 2 million chickens, ducks, and geese have been culled in nearly 600 infected farms to date. While agriculture accounts for only 2% of Taiwan’s GDP, this crisis will have an oversized impact on Taiwan’s economy.

The Taipei Times reported that since the outbreak began in poultry farms in the west, the eastern counties of Taitung, Yilan, and Hualien have put in place a “joint disease prevention front.” Measures were taken to restrict live poultry from being transported on main highways toward these counties. Now that the front has been breached, more severe measures are likely to be enacted, primarily widespread quarantines. The county chief of Taitung called an emergency meeting on Monday to do just that, in an attempt to prevent the virus from spreading to the county’s other poultry farms, which number over 100.

Quarantines will reduce transport and trade, harming rural agricultural areas and consumers. From now on, poultry from Taitung to the capital Taipei will have to take a detour to avoid contaminating Yilan and Hualien. While the Consumer Protection Committee (CPC) stated that as of this past weekend there should be no reason for wholesale chicken prices to rise, it seems unavoidable as the outbreak’s toll increases. Higher transportation costs and fewer birds will lead to increased prices even if the government’s monitoring of illegal price-fixing and hoarding is effective.

There is also the psychological element to this whole crisis, stoking fear and worry among investors and the markets. As early as January 12, Taiwan’s Finance Minister warned that the bird flu outbreaks could be a risk factor for the stock market on top of international market volatility, and things have worsened considerably since then. An estimate of the damage is not possible yet since the outbreak has not been contained, but the longer and more severe it is, the worse its impact will be on Taiwan’s economy.

The Council of Agriculture said over the weekend that the sources of the three flu strains were likely to have been migratory birds rather than domestic mutation. However, it emphasized that greater safeguards are needed in the future, especially at import and export facilities, to minimize the risk of infections spreading. Minor outbreaks of bird flu occur all over the world, but Taiwan cannot afford a repeat of this mess.