China cannot fight coronavirus and avert economic crisis at the same time by Ambrose Evans-Pritchard
China is losing its battle against the 2019-nCoV viral enemy – we must brace for a global pandemic
Where do we now stand? Regions making up two-thirds of Chinese GDP have been closed since late January. It appears that few people have actually returned
Some 25 provinces and municipalities were supposed to go back to work this week but this clashed head on with virus control measures.
Apple supplier Foxconn has yet to restart its core iPhone plants in Zhengzhou and Shenzhen. Just 10pc of its workers have turned up. Caixin reports that Foxconn may wait until March before restarting.
Meanwhile the near complete shutdown of Shanghai’s manufacturing hub in Songjiang belied early claims that 70pc of plants were going back to work.
A nice nugget from the Wall Street Journal: Lui Guifang’s juice shop at Shanghai’s China World complex sold not a single cup on Monday, except to the journalists asking the questions. Normally he would sell a hundred.
Ole Hansen, Saxo Bank’s oil guru, said it is becoming a commodity massacre. We are getting to Lehmanesque levels of disruption. Shipping has buckled. Lloyd’s List says tanker rates have crashed. Richard Meade at Lloyd’s List told me Lloyd’s is getting reports of ships floating round Asia unable to dock at port after port, and running out of food.
My working assumption is that China will lose its battle against the 2019-nCoV viral enemy. .If this is correct we must therefore all brace for a global pandemic. It may already be too late to stop it. The task will then be to tame the virus and hope to buy enough time for warmer weather to slow the spread. It is not the end of the world.
Like Europe in Medieval Times’: Virus Slows China’s Economy
Workers are stuck in their hometowns. Officials want detailed health plans before factories or offices can reopen. Assembly lines that make General Motors cars and Apple iPhones are standing silent.
More than two weeks after China locked down a major city to stop a dangerous viral outbreak, one of the world’s largest economies remains largely idle. Much of the country was supposed to have reopened by now, but its empty streets, quiet factories and legions of inactive workers suggest that weeks or months could pass before this vital motor of global growth is humming again.
The global economy could suffer the longer China stays in low gear. It has been hampered by both the outbreak and its own containment efforts, a process that has cut off workers from their jobs and factories from their raw materials. The result is a slowdown that is already slashing traffic along the world’s shipping lines and leading to forecasts of a sharp fall in production of everything from cars to smartphones.
“It’s like Europe in medieval times,” said Jörg Wuttke, the president of the European Chamber of Commerce in China, “where each city has its checks and crosschecks.”
New York Times 11 Feb
Global Commodity Markets are Underestimating Impact of Coronavirus…
…that’s according to Maximilian J. Layton and a team of analysts at Citigroup, who warned that those markets are barely reflecting the deadly outbreak’s disruptions to supply chains and ”major short-term headwinds for Chinese demand and imports.”
“We urge near-term caution on metals and bulk commodities as there are increasing signs that post-Chinese New Year economic activity restarts will be further delayed after February 10, or early restarts may trigger another round of virus outbreak leading to further large-scale quarantine,” said Layton.
“Either case would result in additional commodity demand destruction which has barely been priced in.”
Barrons 11 Feb