Coronavirus Economic Global Impact Research

Goals

To have an analysis of the economic global impact of the coronavirus. Specifically to show the deep impact of the coronavirus on the global economy due to China's quarantine.

Early Findings

  • The outbreak of a new deadly virus strain is sending international policymakers scrambling as the effects of the crisis are beginning to be felt around the world. The coronavirus, specifically known as the 2019 novel coronavirus (2019-nCoV), is believed to have originated in Wuhan, China and now has infected at least 2,700 people and killed eighty-one.
  • In addition to those within China, cases of the new virus have been reported in eleven other countries.
  • Chinese authorities have responded to the outbreak by locking down Wuhan and other cities across the Hubei province, restricting the travel of more than 60 million people. International experts believe that the virus is at least partially spreading through human-to-human contact.
  • The virus outbreak comes at a particularly bad time for Beijing, as it is right off the heels of continued unrest in Hong Kong and the re-election victory for pro-sovereignty President Tsai Ing-wen in Taiwan, according to Robert A. Manning, a resident senior fellow in the Atlantic Council’s Scowcroft Center for Strategy and Security.
  • The virus first began to spread during the Lunar New Year celebrations, so Chinese factories were already idle for the holiday. The government has now extended the holiday through Feb. 2, but if factories remain shuttered for much longer, it could end up causing major disruptions to global supply chains. China accounts for about 20 percent of global manufacturing output.
  • Businesses including McDonald’s, Starbucks and several hotels have also chosen to close select locations to prevent the virus from spreading. American Airlines, United, British Airways and several other airlines have cut flights to China because of the outbreak.
  • While it’s too early to tell how much of an economic impact the novel coronavirus will have, some economic analysts are using the 2003 SARS outbreak as a benchmark. During that outbreak, more than 8,000 cases were confirmed and 774 people died. The World Bank has estimated that SARS cost the world $54 billion.
  • China is now a much bigger player in the global economy. In 2002, China was the sixth-largest economy in the world; in 2020, it’s the second-largest. Today, what happens to China’s economy has a larger effect on the rest of the world.
  • The coronavirus is starting to impact the technology industry's global business. Apple and Google, among others, have begun closing stores and offices, limiting business travel to China and bracing for supply chain disruption as health officials around the world seek to contain the disease.
  • Many tech companies are monitoring the situation closely and have curtailed nonessential travel. Lenovo, the Chinese laptop maker, said it was avoiding large face-to-face meetings and allowing more people to work from home until more is known about the outbreak.
  • One report estimates that a pandemic could cause an average annual economic loss of 0.7% of global GDP, or $570 billion.
  • Hedge funds have shorted their positions against airlines who operate a high volume of flights to China, with European carriers including British Airways, Lufthansa, Air France-KLM particularly exposed. All three have halted flights to and from China completely, while others have cut down on schedules.
  • "Every day, people rely on Chinese companies for life-saving products. The country is the world’s largest producer of active pharmaceutical ingredients, even if the finished medications get put together in the US or another country. Although it’s too soon to feel any repercussions, the coronavirus outbreak adds uncertainty to that supply."
  • "The full impact of Wuhan virus on China's and the global economy will be known only after the coronavirus spread has been contained fully and normal business restored. But early estimates say the coronavirus outbreak may cost China's economic growth by 0.5 per cent to 1 per cent. At 1 per cent, loss to Chinese economy will be over $136 billion."

Summary Of Our Early Findings Relevant To The Goals

  • Our initial hour of research gathered many insights, statistics, and data surrounding the economic global impact of the coronavirus. This is currently being covered extensively by large numbers of reputable media outlets.
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