Face masks sales soar in the face of SARS - Update - economic news from around Asia

Business Asia, April, 2003

Conducting business in Asia invariably involves a lot of travel, something that has become more than a little hazardous in recent times due to the outbreak of SARS (severe acute respiratory syndrome) in several countries within the region. However, as with any crisis, there are those who are benefiting. A Chinese company that exports surgical masks says orders from Hong Kong doubled in March as the city remained gripped by the deadly respiratory disease. David Han, a sales representative for Shenyang Constructional and Agricultural Machinery Corp in the northwestern capital of Liaoning province, says the increase in orders has been dramatic, enabling the company to raise prices by a tenth. The disease, which causes a pneumonia-like illness and is spread by coughing and sneezing, has killed an increasing number of people and infected hundreds worldwide, with the biggest outbreaks in Hong Kong, Singapore and Vietnam. In Hong Kong, scores of schools have closed, and some people are avoiding crowded places. Face masks, usually seldom seen on the streets, have become prevalent. Drugstore chain AS Watson and Co, owned by billionaire Li Ka-shing, reported a run on its stocks of face masks. It sold out more than a thousand masks in 15 minutes at one store in the Pacific Place shopping mall downtown on 24 March, two days after the first school closures were announced. Masks have been selling for as little as HK$3 ($0.64), with plastic versions going for about HK$12. The Hong Kong Consumer Council said some unscrupulous vendors are taking advantage of the public scare by jacking up prices of masks as high as HK$100.

Japan

Japanese Prime Minister Junichiro Koizumi says the Government and the Central Bank, under new governor Toshihiko Fukui, will cooperate to solve the problems of the world's second largest economy. Fukui pledged to "implement needed policy actions" to shore up the economy, Koizumi says, after an announcement of the Central Bank's decision to expand its program to buy shares from banks by half to three trillion yen ($41.9 billion.) "The Central Bank is taking actions swiftly, listening to our opinions," Koizumi says. Separately, Fukui says he explained the bank's policy decision to Koizumi's key economic panel, whose members did not ask the Central Bank to make any policy changes or to expand the range of assets it buys. The bank must adopt "forward-looking" policies, he added.

Malaysia

Malaysia plans to attract more tourists from new markets such as Pakistan, Turkey, and Iran as it looks to bolster arrivals to the country this year. Tourism Minister Kadir Sheikh Fadzir says those countries have huge populations and they seem to have "quite discovered Malaysia". Tourism is Malaysia's No2 income earner and is estimated to have contributed as much as 42.6 billion ringgit ($18.7 billion) to the nation's gross domestic product last year. Tourist arrivals rose four per cent to 13.3 million in 2002, its fourth year of gains. This figure was boosted by more visitors from neighbouring Singapore and Thailand, the country's two largest markets. That momentum may be hurt by the effects of war in Iraq and a recent outbreak of a respiratory disease that has infected hundreds worldwide and killed at least 17.

Philippines

The Philippine National Oil Co's gas and oil exploration unit said it will select within the year an adviser for a US$100 million ($167.5 million) pipeline that will bring gas from the nation's biggest commercial field to Manila. The state-owned company has been given a permit by the energy department, allowing it to proceed with the pipeline and start talks with prospective partners, Philippine National Oil Exploration Corp president Rufino Bomasang says. He says the company will probably have the financing for the project by mid-next year, and that the mandate is for the Philippine National Oil to spearhead the project with the participation of the private sector. The pipeline will take gas to Manila from Batangas province, where a 500 kilometre undersea pipeline from the country's only commercial gas field feeds its first gas-fired power plants.

Singapore

Singapore will issue seven per cent more vehicle permits for the year ending April 2004, the second consecutive year it's raised the quota as it sells more licenses for cars, goods vehicles and buses. The Land Transport Authority said it will sell a total of 106,231 permits for all vehicles for the year ending April 2004, from 99,136 a year earlier. The Government will issue 35,280 permits for cars with engines of 1.6 litres and smaller this year, compared with 28,860 last year. Singapore controls pollution and congestion on its roads by selling a limited number of permits every year for each category of vehicles. More permits may mean better earnings for motor distributors such as Tan Chong International Ltd, which sells Nissan cars, and Cycle and Carriage Ltd Vehicles are the biggest component of the island's retail sales, accounting for about a quarter of the total.