As the world grapples with the coronavirus, the economic impact is mounting – with the OECD warning the virus presents the biggest danger to the global economy since the 2008 financial crisis.
Here are a few ways the outbreak is sending ripples around the world.
China is the world’s second-largest economy and leading trading nation, so economic fallout from coronavirus also threatens global growth.
Economists polled by Reuters between 7-13 February said they expected China’s economic growth to slump to 4.5% in the first quarter of 2020, down from 6% in the previous quarter – the slowest pace since the financial crisis.
👉Falling oil demand, stock markets down
China is the world’s biggest oil importer. With coronavirus hitting manufacturing and travel, the Internationa Energy Agency (IEA) predicted the first drop in global oil demand in a decade.
“Covid-19 (coronavirus) has spread beyond China and our 2020 base case global oil demand forecast is cut by 1.1 mb/d. For the first time since 2009, demand is expected to fall year-on-year, by 90 kb/d,” the IEA said in its monthly report for March 2020.
👉Cryptocurrencies becoming oppressive
Anyone hoping cryptocurrencies might prove a safe haven was disappointed. Bitcoin lost more than 30% of its value in the five days to 12 March, Reuters reported, outpacing losses for stocks and oil.
👉Impact on air travel
On 5 March – before the US travel ban was announced – the International Air Transport Association (IATA) predicted the COVID-19 outbreak could cost airlines $113 billion in lost revenue as fewer people take flights.
👉Disruption to commerce
The shortage of products and parts from China is affecting companies around the world, as factories delayed opening after the Lunar New Year and workers stayed home to help reduce the spread of the virus.
Apple’s manufacturing partner in China, Foxconn, is facing a production delay. Some carmakers including Nissan and Hyundai temporarily closed factories outside China because they couldn’t get parts.
The pharmaceutical industry is also bracing for disruption to global production.
Many trade shows, cultural and sporting events across the world have been cancelled or postponed.
The travel and tourism industries were hit early on by economic disruption from the outbreak.
Besides the impact on airlines, the UN’s International Civil Aviation Organization (ICAO) forecasts that Japan could lose $1.29 billion of tourism revenue in the first quarter due to the drop in Chinese travellers, while Thailand could lose $1.15 billion.
Our prayers to God Almighty is to cease this disease amidst us. Medical practitioners are trying, but only God heals.
Comrade Olalere Benedict
Global President of NAPS
Comrade Adeniji Boluwaji Temitope (OBEY)
NAPS National Director of Contact and Strategic Planning
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