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Will the coronavirus outbreak derail the global economy?

Coronavirus: a selection of business-focussed stories from national and international publications, some of whom may require a subscription to view in detail (paywall). Curated by George Hamilton

Will the coronavirus outbreak derail the global economy? by Phillip Inman, economics editor

This is the best roundup I have seen to date. It examines all the various issues relating to the virus.


The Guardian 10 Feb

‘Come back soon’: coronavirus wreaks havoc on global tourism hotspots

The outbreak has wreaked havoc across the global tourism industry, which has become increasingly reliant on Chinese visitors. The number of Chinese people going abroad grew rapidly to 150 million in 2018, and operators have responded by designing packages specifically aimed at them.

Italy’s national hotel association, Federalberghi, has said the country – the most popular destination for Chinese visitors to Europe, recording 3.5 million in 2019 – could lose billions of euros as Chinese tourists cancel hotel bookings amid a flight ban.

“A temporary ban on arrivals is manageable,” said Bernabò Bocca, the president of the Venice hotel association. “But if coronavirus discourages the Americans from travelling, it would mean trouble for Italy. The potential damage from a prolonged crisis could reach €4.5bn.”


The Guardian 10 Feb

Xi Jinping appears in public as China returns to work after holiday

China’s president, Xi Jinping, has made his first public appearance in weeks, as some people began to return to work following the lunar new year holiday, which was extended as authorities grappled with the coronavirus outbreak.

Around China, workers began trickling back to offices and factories as the government eased restrictions on work and travel. In Beijing, roads were busier than in recent weeks but normally packed trains remained virtually empty. The few commuters on the street or using public transport were wearing face masks. Many companies have asked their staff to work from home.

Authorities had told businesses to add up to 10 extra days on to lunar new year holidays that had been due to finish at the end of January.


The Guardian 10 Feb

Could the coronavirus outbreak create a global electronics shortage?

At the end of the lunar new year, millions of Chinese workers who travel across the country to visit family return to manufacturing hubs like Shenzhen, Ningbo and Guangzhou.

This year has been different. The coronavirus epidemic has already seen the new year, which was due to end on Thursday, extended until this Sunday, and Beijing has advised citizens to avoid travel. Even when the holiday does end, it is unclear how many workers will return to the manufacturing hubs where they earn their living.

“The real question is how afraid people are. Will the labour move back or will people just stay in their hometown?” says David Collins of China Manufacturing Consultants, and a former executive at Foxconn, the Taiwanese electronics company that is China’s biggest private employer and a key supplier to Apple.

Wuhan, the epicentre of the outbreak, is a critical location in the technology sector’s sprawling supply chain. Figures from data firm Panjiva show over 450 US importers are exposed to a supply chain hit from slowdowns in Wuhan’s wider province of Hubei, which had a GDP of $595bn (£454bn) in 2018. Last year, the region accounted for 27.4pc of US seaborne shipments related to Foxconn alone.


Daily Telegraph 10 Feb

What the coronavirus and other dramas of 2020 tell us about how markets react to bad news by Tom Stevenson

Despite tales of gloom, investors still believe that corporate profits, the ultimate driver of markets, are heading in the right direction

Taking their cue from Wall Street, stock markets around the world continue to hit or approach new highs. This is despite the fact that news headlines since the beginning of the year have been consistently negative. In the face of coronavirus, Middle East tensions and the impeachment saga, the 11-year bull market sails on regardless.

Tom Stevenson is an investment director at Fidelity International


Daily Telegraph 10 Feb