You might be living under a rock if you haven’t heard the news about the pandemic spread that’s heating up lately. Indeed, other than calamities and natural disasters, the Novel Coronavirus or so-called 2019-nCoV or COVID-19 impose a serious threat not only to our health and society but to the economy as well.
Everybody is talking about it. How about we take a look to discover why.
Overview of Novel Coronavirus
The 2019-nCoV is a zoonotic (transmitted between animals and humans) disease that was first reported back on the 21st of December 2019. It is said that this disease originated from Wuhan, the capital of Hubei Province, in China.
The transmission can occur in the form of droplets from an individual contaminated through cough or sneeze. It’s not airborne so any close to home contact with a person, object, or animals with the virus is the fatal source.
It is said that 1 contaminated person can infect up to 14 people, especially those within the family or medical workers. As COVID-19 has no specific treatment nor vaccination yet, most likely, passing can be the outcome. Still, everyone is advised to drink plenty of fluids, get more rest, and stay healthy.
Compared to other epidemic and pandemic virus outbreaks, particularly it’s sister virus, MERS-CoV (Middle East respiratory syndrome coronavirus) and SARS (Severe Acute Respiratory Syndrome), COVID-19 has low fatality rate but spread much faster than it is expected.
See why it imposes panic on everyone lately? What’s worse is that this virus is imposing lots of questions towards economic stability as well. Be that as it may, how?
Impact to the Economy
You’re no stranger to the solid development and stability of the Chinese economy. China currently holds the second-largest economy with the largest tourism market, and the largest manufacturer in the world when the pandemic took place. While Wuhan of the Hubei Province comprises significant foundations for farming and hardware.
What does this mean
Because of the fear of getting infected, the local and international government restricts the travel for both native and tourists in the country. The manufacturer’s supply and services are halted, making little to no-production at all. And their international projects are surely scheduled as delayed.
Sectors and industries such as travel, tourism, airlines, manufacture, factories, energy, shipping, technology, mobile, and medicine were all highly affected!
You aren’t reading it wrong. Chinese Government and the Large companies closed their branches in China, afraid of affecting more than what it needs to be protected.
Big Brands such as Apple, Tesla, and Microsoft, showed a significant amount of sales dropped as they shut down their employees, franchise, and branches in the country leaving more room to decrease the level of monetary steadiness. If this goes on, built manufacturing plants in China would be futile for a period of time that would result in shortage of products and services.
What if the transmission becomes stabilized
Even with the country’s pronouncement of the infection being stabilized, economic damage is still apparent.There’s no manpower or employees who would want to work as they are taken aback by the virus.
And depending on the contract and permission, all sorts of businesses were meant to pay for their workers, both present and absent, during the shutdown. What would hurt is the fact that how is it possible to get revenues if they weren’t receiving anything at all?
Just recently, a credible source uncovered that the global market dropped a level of 9.1% in one day! And with the lockdown that imposed, 10% of China’s Gross Domestic Product (GDP) is highly affected and about to go to slump by 4.5% from 6% on the first quarter of the year. And so does the 9% of the Chinese Stock Market, 35% of the country’s economy, and the 28 million jobs in the country.
Are other countries affected
This impediment does not only limit to China, but to the entire world’s value chain of businesses, manufacturing, trade, and economy. This is troubling especially for the countries who profoundly rely upon China for manufacturing, tourism, and remittances majority from United States, Japan, South Korea, Brazil, Germany, and Europe.
Every American and international company who has their franchise and branches within China are closed down resulting in the declining number of revenue. Even if they highly depend on the transaction inside their country, it is more likely that they couldn’t function without goods, services, and consumers abroad.
This is such a bad time for countries who are just about to recover from their global trade tension such as Germany, and majorly, in Japan that has disrupted automakers.
Nearby countries are cutting their own growth expectation from the economic fallout with China. South Korea, Thailand, Malaysia, and Singapore are few of those planning an economic stimulus to offset the damage. While Japan is in risk of recession as they just recently launched their economic stimulus for last year’s economic fallout. This means they have to pumped the stimulus twice as hard than the other affected countries.
Based on the findings of Oxford Economics, the global growth of the economy would tally down 1.3% this year which is about $1.1 trillion lost of income.
Some Economists suggested that most countries, especially the first-world countries, have an inventory that could last up to a month or two. About 85% of the Large Stock Market has enough funds for more than six months.
But still, the effects of COVID-19 in the next several weeks, few months, or years is uncertain or as per the chief economist of Capital Economics, Neil Shearing said, “…it’s almost impossible to predict”.
What can be done
China is making its own way on how to find a cure and vaccination to the COVID-19. They also started taking measures on how to control the economic disaster both inside their country, and foreign exchange and revenue to other countries as well whether this means that they have to cut down interest rates, giving tax breaks, or subsidies to the consumers and citizens who are living from paycheck to paycheck.
This isn’t the first time that something pandemic like this happened. Have you heard about the 1912 – Spanish Flu? Do you remember the 2002 SARS or the 2015 – MERS-CoV? These cases have taught us that they won’t entirely control the economy, the country, and the people. We can all bounce back with proper precautions, measurements, and full cooperation.
But panicking won’t do any good. As individuals, we can personally try to prevent the virus from spreading. Start within ourselves. Boost our immune system and maintain a safe environment and good health.
We cannot defend one’s government, but we can be safe that not everything we hear from the media or we read from the internet is all real. There are shrouded realities underneath that we can’t control nor find yet.
As entrepreneurs and businessmen, these are the situations that call for preparedness. Beginners or not, before you put away your money, things and occasions like the pandemic flare-up ought to be one of our interests and concerns directly from the beginning.
Would you be one of those marketers who make use of the situation to earn more? We’re not saying it’s unlawful, however, paranoid notions began to circulate with such actions. They use FEAR to market, and to earn.
It doesn’t necessarily have to be that bad. Maybe you can open up a mask production that we all believe could help. Begin blending formulas or synthetic substances and fluids an effective alcohol-production or whatsoever. This means you can double your income than sticking to the usual rate.
What can we say? It’s the oldest form of power – FEAR! Now if you overreact, start to panic, and think negatively, you’re driving your way behind the wheels. But what you can do is to stay in control, think outside the box, consider fresh possibilities, research thoroughly, and possibly, create an objective adaptation of dread.
We can’t highly rely on a specific country nor manufacturer. We need to become mindful, use our discernment in making decisions, and apply wisdom to effectively stand alone in the Market. Create better moves in times like this.
You can achieve success financially and by helping people to get awareness.
