Answer:

The outbreak of coronavirus will have a larger negative effect on the global economy than the SARS (Severe Acute Respiratory Syndrome) outbreak in 2003, as any slowdown in Chinese economy would send not ripples but waves across the globe, IHS Markit said on Friday.

The virus has brought LARGE parts of the world's second largest economy to a standstill and its impact was felt across industries.

Explanation:



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Coronavirus to have larger impact on global economy than SARS: IHS Markit

The virus has brought large parts of the world's second largest economy to a standstill and its impact was felt across industries. London-based IHS Markit said if the CURRENT confinement measures in CHINA stay in place until the end of February, a...

Feb 07, 2020, 04.30 PM IST



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New Delhi: The outbreak of coronavirus will have a larger negative effect on the global economy than the SARS (Severe Acute Respiratory Syndrome) outbreak in 2003, as any slowdown in Chinese economy would send not ripples but waves across the globe, IHS Markit said on Friday.

The virus has brought large parts of the world's second largest economy to a standstill and its impact was felt across industries.

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"Coronavirus will have a larger negative effect on the global economy than the SARS outbreak in 2003. At the time of SARS, China was the sixth largest economy, accounting for only 4.2 PER cent of world GDP. China is now the world's second largest economy, accounting for 16.3 per cent of world GDP. Therefore, any slowdown in the Chinese economy sends not ripples but waves across the globe," IHS said in a COMMENTARY on coronavirus outbreak.

If the current and unprecedented confinement measures in China stay in place until the end of February, and are lifted progressively beginning in March, the resulting economic impact will be concentrated in the first half of 2020, with a reduction of global real GDP of 0.8 per cent in Q1 and 0.5 per cent in Q2, it said.

In this scenario, the coronavirus and resulting measures will reduce global real GDP by 0.4 per cent in 2020.

On the other hand, if confinement measures begin to lift on February 10, the impact on global GDP will be more limited, resulting in a 0.1 per cent reduction in global GDP growth in 2020 and 0.4 per cent reduction in China's annual growth.