A new coronavirus, which first surfaced in the central Chinese city of Wuhan, has already killed and infected across the world, defying global financial markets and politics.
Scientists have identified a new kind of coronavirus that first surfaced in the central Chinese city of Wuhan. Until January 22nd, it had spread far beyond China’s borders into Japan, South Korea, Taiwan, and the United States, with about 300 identified cases.
What’s worse is that the new coronavirus, which can be transmitted from one person to another, is slamming China in the midst of the Chinese New Year, a significant travel period for the Chinese. And while many unidentified cases, fake news, false, untrue alarms are still plenty, and some sort of containment seems far off, many across the globe are starting to fear a repeat of the 2003 outbreak of SARS, which originated in China, killed nearly 800 people in several countries, and caused a large uncertainty in financial markets.
Behind this paranoia and dubious times, there is a clear political problem surrounding the China controversy with the current outbreak: Containing public health threats depends on the fast, efficient flow of accurate information within countries and across borders, and that can mean a problem for the world’s authoritarian countries, China included, a GZERO article reports.
China’s local authorities have an incentive to promote good news and hide bad news, as no free press is there to hold them accountable for the lies, however, the incentives for local-level secrecy and a lack of public accountability remain, as large number of anecdotal evidence that the numbers of patients infected in the current outbreak are being undercounted is alarming and mounting, naturally turning China’s people and foreign governments into a mistrust and an unsettlement of the political handling of a problem that could yet trigger a much wider pandemic, even when state officials have openly admitted that mistakes were made during the 2003 SARS outbreak and pledged to be much more transparent in the future
However, according Myra P. Saefong from MarketWatch, if the 2002-2003 severe acute respiratory syndrome epidemic, known as SARS, may serve as a guide, the overall impact of the virus outbreak may be modest and short lived on the global economy, as well as on the commodities sector. For now, the spread of the coronavirus across Asia into the U.S. is “clearly a major public health concern but it is expected that its economic effects will be modest,” said Jennifer McKeown, head of the Global Economics Service at Capital Economics,
“Based on the information we have, we do not expect the coronavirus to have more than a temporary effect on global GDP, which is likely to be made up once the disease is brought under control,” (…) “And while there have already been some effects on financial markets…we suspect that these too will be short-lived,” McKeown added.
Economic blows from the new coronavirus
- After news of a single coronavirus case diagnosed in the United States emerged Tuesday, January 21st, prices for industrial metals such as silver and copper finished lower. The virus will “result in less consumer spending in the short term.” Depending on the scope of the spread, “industrial metals can fall between 3% to 5% anytime.”
- According to Morning Brew, travel-related stocks got hit by growing fears of the China-based coronavirus spreading around the globe. Yesterday, the CDC announced the first confirmed case of the virus in the U.S.
- Japan’s Nikkei lost 0.8% and Shanghai blue chips 1.5%, with airlines under pressure.
- Shares have fallen across Asia Pacific amid mounting concerns.