Preliminary information on the impact of the COVID-19 virus on the Chinese economy reveals significant dips in areas of industrial production as well as retail sales.
According to a report that was released from the National Bureau Statistics of China, shows a 13.5 percent decay in industrial output across the initial two months of 2020.
For retail sales, a more significant 20.5 percent warning was reported during January and February, while the metric gauging construction field experienced a 24.5 decrease in the Country as a result of mass quarantines as well as social distancing implementations taken to prevent a spread of the corona virus.
Businesses and factories surrounding China were locked down during January and February to inhibit the spread of the corona virus. This method has proved to be effective so far in discontinuing the spread and has encouraged governments across the globe to follow suit and mass quarantine their inhabitants.
However, while the spread of the corona virus seems to slow down with these aggressive measures, the influence on China’s economy and products reveals what may lie in the future for some countries since global markets continue to plunge.
The Economic Influence Of Covid-19
China, once at the core of the COVID-19 pandemic, seems to be recovering. As the number of stated local transmission cases are close to zero, daily life is gradually starting to recover to return to normal.
However, the economic figures from the initial two months of the year displays the damage inflicted to the Country’s finances. This foreshadows what other countries might go through during the initial stages of the outbreak.
As shops and factories in China reopens, the country seems to recover from the first side shock as a result from the lock-down. However, presently the country faces these demand issues:
Domestic Demand
Due to bankruptcies, psychological scars, and job losses, domestic demand is slowly regaining traction. A high percentage of respondents are planning to curb their spending habits after the disease.
Overseas Demand
The overseas demand is impacted as a result of more countries facing outbreaks. Many retailers are cancelling orders or closing up shop, resulting in an oversupply of goods. With quick recovery seeming unlikely, numerous economists predict China’s GDP to decline in the initial quarter of 2020 – the first plummet for the country since 1976.
Threat Lurking On The Horizon
The main question remains. Will other countries follow the same path as China? It would seem so, based on the preliminary economic information. Have a look at this article about how China pioneers digital currency for economic recovery.
The United States
Almost half of the population in the US are under strict stay-at-home orders, substantially limiting economic doing and compelling widespread layoffs. During the week of March, the 21st, the entire unemployment insurance claims escalated to nearly 3.3 million, the highest ever level in recorded history.
Manufacturing action in Easter Pennsylvania, in the Southern New Jersey and Delaware regions dropped to the lowest ever level since July of 2012.
Globally
Other countries are also experiencing the economic crunch due to COVID-19. For instance, worldwide online reservations for seated diners have deteriorated by one hundred percent year-over-year.
Almost one million individuals in Canada applied for unemployment benefits. Hard-hit countries such as Spain and Italy which already had high numbers in unemployment are also at risk of seeing economic blows. However, it is too early to predict the extent of the damage caused.
Is There Some Light At The End Of The Tunnel?
Considering the almost-shutdown of numerous economies, the IMF is predicting a worldwide recession in 2020. The UN singly estimates that COVID-19 can result in a $2 trillion shortfall in worldwide income.
However, on a lighter note, some analysts are predicting a recovery as premature as the third quarter of the year 2020. Various factors like consumer confidence, government stimulus, and the total of coronavirus cases, can influence this timeline.
The Importance Of Social Distancing During Covid-19
As the nations are awaiting the development of vaccines for COVID-19 by healthcare professionals and scientists, we presently have a more readily available method at our disposal. Social distancing, used as a measure to lower physical contact, is the initial line of defence for keeping an infectious disease like COVID-19 contained.
The main reason being that such infections are being spread by people sneezing, coughing or touching surfaces where the virus is present. They help us comprehend the impact such measures can have; it should be communicated to all how a reduction in social exposure can potentially contain the spreading of the infection.
What Does Social Distancing Mean?
- Keep at least six feet (2 meters) away from others.
- Avoid non-essential social gatherings and large crowds.
- Limit contact with individuals who are at higher risk.
What Can You Do To Make A Difference?
- Work from home whenever you can.
- Avoid hugs or handshakes and greet with a wave instead.
- Stay at home and only go out for essential items.
For This To Work, We All Must Participate
With the worldwide number of the COVID-19 cases continuously rising, many governments have taken precautions and issued quarantine orders in conjunction with travel restrictions to reduce social interaction as much as possible. Mathematics backs such decisions.
By lowering physical contact with others, even if you’re not displaying any of the symptoms linked to coronavirus, is critical at this stage. Studies prove that the sooner action is taken, rather than later, the more effective these measures can be in lowering the spread of the infection and keeping it contained.
Social distancing proves to be a powerful disease control implementation, however it can only be efficient if everyone understands the importance of such measures and are willing to participate. In many instances, there are always a few individuals that do not grasp the impact of such an epidemic and try to bypass safety measures imposed by the Government.
However, if everyone works together as a nation and abides by the lock-down regulations, the virus can be contained, and lesser people will be affected. As such, the country can gradually start recovering and resume life as they knew it.
