China has taken the extraordinary step of extending the Lunar New Year holiday — in some places by more than a week — in an effort to contain the deadly coronavirus. Some cities have also been effectively quarantined. That means major trouble for the world’s second biggest economy. The virus outbreak escalated just before the new year, one of China’s most significant economic events. Chinese consumers spent more than 1 trillion yuan ($145 billion) last year on holiday shopping, dining, entertainment and travel, according to state news agency Xinhua. Extensive travel restrictions and fears about the virus mean people aren’t spending as much this week. But the extended holiday — to February 2 nationwide and for another week beyond that in Shanghai and several provinces — will impact millions of people in other ways as government offices and schools remain closed. Major companies such as Tencent\n \n (TENC)\n \n (TCEHY), Huawei and Alibaba\n \n (BABA), will feel the effects, too, as head offices remain shut. Tencent\n \n (TENC)\n \n (TCEHY) has told its roughly 54,000 employees that it will be extending holidays until February 9. Exactly how big the economic hit will be is hard to predict. China hasn’t come to a complete standstill — the Shanghai Stock Exchange is reopening on February 3. Grocery stores and food delivery services are still up and running, even in areas under lockdown. ING economist Iris Pang said Wednesday that the outbreak would knock a modest 0.3 percentage points off China’s first quarter growth. But Tommy Wu, analyst at Oxford Economics, said the impact could be worse than the SARS outbreak in 2003, given the coronavirus is spreading rapidly and coincides with the holiday travel rush. Economists at Nomura warned that the outbreak could knock more than two percentage points off growth in the first quarter — larger than the quarterly drop registered during SARS. Patrick Perret-Green, an economist with research firm AdMacro, said the hit to China’s annual growth rate could be even more severe. “There will be no quick recovery. China was growing strongly [during SARS], as was the rest of the world,” he said. “Now China and the global economy is like a patient on dialysis, and somebody just pulled an IV out.” A big hit to growth Before the outbreak escalated this month, the International Monetary Fund and the World Bank had forecast China’s annual economic growth to fall to about 6%, down from 6.1% in 2019. Perret-Green said the outbreak and measures to contain it could push China’s 2020 GDP growth rate near levels last seen in 1990, when it was 3.9%, according to World Bank data. “Officially it may be closer to 4.5% and possibly the reality could be close to zero,” said Perret-Green, who suggested the government severely overstates its GDP figures to begin with. Margaret Yang, an analyst at brokerage firm CMC Markets, said the “adverse economic impact is enormous.” All sectors will likely feel the effects of the delay in getting back to work, she said in a research note Tuesday, singling out transportation, tourism, entertainment, retail and commercial property. The Wuhan coronavirus has already killed 132 people, and infected over 6,000 others in China, but is not yet as lethal as the 2003 SARS outbreak. SARS had a roughly 10% fatality rate, compared to the estimated 3% for the coronavirus right now. But the economic costs aren’t only about how deadly the virus is, according to Andrew Batson and Ernan Cui, analysts at research firm Gavekal Dragonomics. “These costs are instead going to be determined by the measures China’s government takes to contain its spread — measures which have rapidly escalated to an unprecedented severity,” they wrote in a research note on Tuesday. Travel and tourism will have an outsized effect, Batson and Cui said. They noted that the sector raked in 514 billion yuan ($74 billion) during the seven-day holiday in 2019, equivalent to 2% of first quarter GDP. Travel industry suffering There has already been a plunge in the number of trips made during the holiday. Liu Xiaoming, China’s vice minister for transport, told reporters on Sunday that the overall number of trips made across the country on the first day of the Lunar New Year fell nearly 30% from a year ago. Travel by plane and train fell more than 41%, he added. Major travel companies, hotels and airlines are waiving cancellation fees and offering refunds through most of February. Some airlines are suspending services. Meanwhile, major tourist spots including museums, Beijing’s Forbidden City and even Disney\n \n (DIS)’s parks in Shanghai and Hong Kong have shuttered their doors. Beijing and other cities across China also canceled Lunar New Year celebrations, trying to limit crowds. “This will mean a permanent loss of revenue from tourist activities, as the canceled excursions are not going to be repeated after the holiday is over,” wrote Batson and Cui. Even after the extended vacation ends, China won’t be returning to business as usual. Many people will likely remain cautious, staying indoors and avoiding crowded areas. — CNN’s Vanessa Yung, Serenitie Wang and Yong Xiong contributed to this report.