AssessmentsFeb 25, 2020 | 10:30 GMT
The Fuzzy Math of Projecting the Coronavirus' Economic Impact
Several weeks into the outbreak of the COVID-19 coronavirus that originated in Wuhan, Hubei Province, China, it's clear the economic impact will be significant, even if just temporary. After all, it's not possible to shut down a large portion of the world's second-largest economy without directly affecting global growth, including subsequent spillovers to other countries from China's global integration.
Current projections of monetary losses seem to be derived from the impact of the 2003 SARS epidemic, scaled to changes in the size of China's economy, plus attempts to account for China's increased trade linkages and greater weight in world trade. What's significantly different now is China's integration into global supply chains, including as a supplier of intermediate inputs used in final production.
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