Asian economies overcome Sars

By Andrew Walker
BBC economics correspondent

Sars had a huge impact on Asia

It is a year since the first recorded case of the pneumonia-like illness, Sars, in southern China.

It was several months before the world took notice as the virus spread internationally.

The outbreak had a significant economic impact, especially in East Asia, with some economists warning that it could tip the world into recession.

However, in the event it did not work out as badly as many feared.

Affected industries

For East Asia, Sars looked at one stage as though it might be a very severe economic blow.

And the short term impact, while the outbreak continued to spread, was substantial.

Tourism, including business travel, retailing and leisure were the main affected industries.

The Sars virus had an impact on many Asian economies

It was a case of people avoiding things they did not have to do and which might expose them to people carrying the virus.

And the disease arrived at a time when the world economy was already weak.

There had been a sharp slowdown in 2001 - some economists called it a recession.

The subsequent recovery was lacklustre, and there was the growing prospect of a war in Iraq undermining business and consumer confidence.

Some warned that this was a recipe for a global recession.

Bounced back

In the event, the lasting economic consequences were nothing like as severe as the worst fears had suggested.

During the course of 2003, the outbreak was contained, the war in Iraq came and went, and confidence revived.

With the fear gone, pent-up demand for travel and leisure made itself felt strongly.

Some Asian business people say they are surprised by how quickly the region's economies have bounced back.

Of course, there could be a set-back if Sars returns this winter in the northern hemisphere, as some health experts say it might.

But the context would be one of a world economy looking rather stronger than it was when the disease first arrived.