The person responsible for prosperity and Jobs, the concern is that the outbreak of the Coronavirus could not touch the world moved value-added chain of the export industry, but the caps. The corona virus hits the world economy is now significantly harder than the Sars Virus.
three reasons:
The biological reason: have died in the Meantime with over 1700 dead, and more people to the consequences of infection as in the case of the Sars pandemic in 2002/03. Worldwide, infected about 71,000 people. Prof. Gabriel Leung, an expert on public health in Hong Kong, estimates that could be infected in the worst case, up to two-thirds of the world’s population. The very adaptable and, thus, changeable Virus should be considered “public enemy number one”, according to the world health organization.
The economic reason: , The Chinese economy plays in the global economy today has a much bigger role than 17 years ago. China’s share of global gross domestic product in 2003 was 8.8 percent, it has doubled since then. China, is weakening the West is weakening. Without the Chinese between products hardly any other country can do. Without exports to China, the lights go out in many places. Steingart/media pioneer
The political reason: of The Coronavirus enlarged the rift between China and the United States. The Communist leadership is likely to keep their written promises to the acceptance of American products. The USA is the Donald Trump see’s your Chance to step up the fight against the Chinese dominance in many markets – only now.
The global economy is thus, at the beginning of the new decade in front of six challenges:
1. The monetary policy must respond. The Chinese Central Bank has already pumped more than € 270 billion in the economy. Fed Chairman Jerome Powell and ECB President Christine Lagarde are also ready – if necessary, there will again be interest rate cuts. Who no longer believes, the Deposit rate of the ECB of -0.5 per cent let, under offer, you are wrong. Appropriate contingency plans will be played by. The Person
Michael Bröcker editor-in-chief of the Media Pioneer is. The free Morning Briefing, you can find here: www.gaborsteingart.com
2. The corporations have to fear a further Economic slowdown. The Eurozone grew – even without the epidemic in the last quarter as slow as for the past seven years. Exports to China are for seven percent of all German exports, which in turn means that almost three percent of our GDP (see chart). China gets a fever, suffers from Germany with the chills. Steingart/media pioneer
3. Hard, the German automotive industry is made. Because The sales in China is faltering. For the first half of the year, the China Association of automobile manufacturers expects a decline in sales of ten percent. In January they are broke in comparison to the previous year by 20 percent – the biggest decline since January 2012. Volkswagen continued in the first month of 2020 in China around 343.000 vehicles – eleven percent less than in 2019. If the Board has an Anti-lock braking system, he should turn it on now.
4. China is for car manufacturers such as VW, is an indispensable part of the supply chain. Closed plants and forced breaks for workers in China, forcing the Team to group chief Herbert Diess already today, to rethink. Possibly the supply chains need to be moved also global new. Chilling example of this Fiat is that The Management had to close a factory in Serbia, because from China, no parts arrived. Globalisation with a pause button. Steingart/media pioneer
5. The Coronavirus has a serious impact on Europe’s core industries, for example tourism. After numerous Airlines have placed their China Connections already at a standstill, expects the hotel industry with cancellations. According to the market research Institute Cotri around two million Chinese people per year travel to Germany, in the meantime, if you still. The country is de facto under quarantine.
6. The Coronavirus epidemic fuelled the power struggle USA vs. China. The Beijing government had promised the USA in 2020 and 2021 for additional industrial goods, agricultural products and services to the value of around 200 billion US-Dollar weight. That is, given the slowdown in growth in China, hardly more. On the other hand, Trump uses any weakness to his idea of “Decoupling” (decoupling) of the economies forward. The Virus is his best helper.
caution-risk of Infection
conclusion : If this is because once written, the history of the Coronavirus, it could well be that the medical consequences of riding only a Chapter at best. For the one-party system in China, issues of Reputation and stability are raised. The West needs to fear for its jobs and its economic well-being. For all of us caution risk of Infection is therefore:!
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