Why coronavirus is bad news for the global economy?
The current outbreak of novel coronavirus (2019-nCoV) was first reported from Wuhan, China, on 31 December 2019. Ever since, WHO has been tracking the spread and virulence of the virus, to provide advice to countries and individuals on measures to protect health and prevent the spread of this outbreak.
As the coronavirus outbreak continues to spread across China, a lot of early research is going on to have a clearer picture and know the key factors that will determine whether and how it can be contained.
Amidst growing concern, Health agencies worldwide and people at large are concerned about how far will this virus spread. One estimate predicts that the total number of infections in five major Chinese cities — Beijing, Shanghai, Guangzhou, Shenzhen, and Chongqing — will peak between late April and early May. As things are changing rapidly some disease transmission has already taken place beyond Chinese borders, specifically in Germany.
China is the second-biggest economy in the world. Any fluctuation in the GDP growth rate projection in China's economy is bound to impact the global slowdown. In 2002-03, China was bogged down by SARS (Severe Acute Respiratory Syndrome) which had a higher fatality rate than the current coronavirus. Estimates suggest that the SARS outbreak impacted China's GDP growth rate by 1.1 to 2.6 percentage points. Remembering that China's and the world's economy was less interconnected and interdependent on one another back in 2002-03, the effect could be more devastating this time for the global economy.
The coronavirus outbreak has aggravated the worries of global economists. It is estimated that the coronavirus outbreak may impact China's economic growth by up to 1 percent. According to ADB, the SARS outbreak of 2002-03 had caused a loss of $18 billion.
The impact of the coronavirus outbreak is already being felt across the globe. All the sectors and stock exchanges around the world are feeling the impact
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