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Wednesday, 29 August, 2001, 14:27 GMT 15:27 UK

FMD report: Outbreak's economic impact


The foot-and-mouth epidemic has had a severe effect on both agriculture and the tourism industry. A new report by the Countryside Agency says the epidemic could cost the UK up to £4.1bn.

The report also says more money has been lost to the UK economy as a result of the effect of the outbreak on tourism than as a result of its effect on agriculture.

Here are some of the report's key points.

  • Economy: £2.4 - £4.1bn lost in 2001 overall

    The report says FMD's impact on the UK economy will be up to 0.5% - £4.1bn - of the UK's GDP.

    Nationally around 25% of firms have been affected by the crisis - but this rises to 40% of firms in Devon, Cornwall and Cumbria.

    The full economic impact will not be known for some time - but the report says that 15-20,000 jobs could be at risk in Cumbria alone as a result of the epidemic.

  • Tourism: £2 - 3bn lost in 2001

    The downturn in the tourism industry is largely due to the reduction of international tourists visiting the UK.

    Early estimates for revenue losses as a result in a decline in overseas tourists are £1 - 2.3bn. The British Hospitality Association estimates that there has been a 10% reduction in the number of foriegn visitors to the UK this year.

    The Office of National Statistics says that for the period from April to June there was a 5% decrease in the number of foriegn tourists compared to the previous three months.

    Reduced foriegn tourism has had a bigger effect on urban areas than the countryside - but cities have in turn benefitted from more domestic tourists - who have been unable to visit the countryside as a result of FMD.

    The report says that 80% of "accommodation providers" have been affected - and one third say that business has dropped by more than 25%.

    It is estimated that at least 20,000 to 30,000 jobs in tourism could be affected by the end of the year.

  • Agriculture: between £800m and £2.4bn lost in 2001

    The report estimates that loss of exports will cost between £310 - £400m in 2001 - and will continue at £36m each month for as long as the export ban continues.

    It would take about 40 days for EU markets to open after the UK is declared disease-free - and could be up to six months for some non EU destinations.

    The total cost of FMD compensation to farmers for slaughtered livestock is expected to be about £1.1bn.

    Knock-on effects for the UK agricultural supply sector include a decline in sales, livestock market closures and loss of business to livestock transporters.


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