It is not that common seeing diseases as something that might provoke a big change in the global economic scenario. Usually, people see sickness as something very particular. My finances will not be affected if your kid is with the flu, for instance. However, when a nation gets sick, you can expect many implications, even for the economy. Some think that the effect can be positive, like Wilbur Ross. According to him, the crisis would help Americans to get jobs. However, this is not the case. The global and local impacts of Coronavirus are problematic for everyone.
Besides, the Chinese economy is not only suffering from the impacts of the disease. Actually, their economy is shrinking for many other reasons. For the first time in a decade, last year Hong Kong faced a recession caused by different factors. Firstly, we must consider that the trade deal between the US and China is not the best one. Actually both nations are involved in something known as a trade war right now. In order to understand the conflict and its implications, please read the information below.
Trade war, violent protests and the impacts of Coronavirus might affect no only China, but the whole world
We can trace the beginning of the Trade war to 2018. Back then, the US President, Donald Trump, began setting tariffs and other trade barriers on China with the goal of forcing it to make changes to “unfair trade practices”. Besides, China had a very difficult time facing increasingly violent protests in 2019. The Anti-Extradition Law Amendment Bill (Anti-ELAB) movement or Hong Kong protests are an ongoing series of demonstrations. They triggered by the introduction of the Fugitive Offenders amendment bill by the Hong Kong government.
Finally, we must consider the impacts of Coronavirus on top of all this mess. As we previously mentioned, there are Americans who think that the problem will get them more jobs. This is a position that reveals how much they are interested in the wellness of the trade partner. However, Goldman Sachs says that the US should not be expecting good results. According to them, the disease will impact the economy in a slight way, but negatively. Chinese people will not fly to the United States for a while and commercial relationships might be shaken.
According to Hong Kong’s Financial Secretary Paul Chan, coronavirus “will definitely cause a double blow to the economy”. Besides that, he stated that the virus “will greatly increase the risk of continued economic contraction this year.” Despite the bad news, knowing that the problem affects everyone might help other nations to engage in the finding of a cure or treatment. In difficult times, there is no way of getting out of a trade deal with no bruises. However, if both parts are seriously involved, problems such as the impacts of Coronavirus will be solved.