Wednesday, February 26, 2020

Our Brothers' Keepers

The coronavirus has underscored just how important China has become to the world economy. It's much more important than it was during the SARS crisis. Jeffrey Frankel writes:

It is becoming increasingly clear, however, that this new coronavirus is likely to do much more damage than Sars. Not only has Covid-19 already caused more deaths than its predecessor; its economic consequences are likely to be compounded by unfavourable conditions – beginning with China’s increased economic vulnerability.
China’s economy has grown significantly more slowly in the last decade than it did previously. Of course, after decades of double-digit growth, that was to be expected and China has managed to avoid a hard landing. But Chinese banks hold large amounts of non-performing loans – a source of major risks.
As the Covid-19 outbreak disrupts economic activity – owing partly to the unprecedented quarantining of huge subsets of the population – there is reason to expect a sharp slowdown this year, with growth falling significantly below last year’s official rate of 6.1%. During the recent meeting of G20 finance ministers, the IMF downgraded its growth forecast for China to 5.6% for 2020 – its lowest level since 1990.
This could hinder global growth considerably because the world economy is more dependent on China than ever. In 2003, China constituted only 4% of global GDP; today, that figure stands at 17% (at current exchange rates).
Moreover, because China is a global supply-chain hub, disruptions there undermine output elsewhere. Commodity exporters – including Australia, and most of Africa, Latin America and the Middle East – are likely to be affected the most, as China tends to be their largest customer. But all of China’s major trading partners are vulnerable.

But, more than China's now central place in the global economic system, the coronavirus has also made clear just how interconnected we now are -- not just economically but in all ways.

We are, more than ever, our brothers' keepers.


Anonymous said...

"owing partly to the unprecedented quarantining of huge subsets of the population"


Shades of E. A. Blair.

Why are people hyper-reacting over this?

This virus is less dangerous than the current forms of the flu. China does not provide us with numbers on their "normal" flu rates. No one seems to publish statistics on how many people come back in other years with other forms of flu.

Meanwhile in Canada:

But isn't it convenient for China to have yet another handle for incarceration - one that is totally supported by the rest of the world.

And won't this be I nice hammer for certain other narciissitic haters to wield?


Owen Gray said...

It's important to keep a sense of perspective, kh. The most dangerous bug is still the traditional flu. A lot of people are upset because this bug started in China, where people look different than us. We fail to recognize that diseases don't take note of the colour of your skin or the shape of your eyes.

We are haunted by old prejudices.

The Disaffected Lib said...

What makes this different, from what I've read, is that some can contract it yet experience few, even no symptoms. This means they can freely circulate through the general population with no one the wiser spreading the contagion.

I don't know where kh did his epidemiology internship but I'll accept the opinion of the WHO for now. kh comes across as something of an anti-vaxxer.

Owen Gray said...

We're dealing with lots of unknowns here, Mound. That's no reason to panic. But, on the other hand, that's also no reason to be complacent.

Toby said...

I'm inclined to side with kh above. The medical community is wise to be prudent; no complaint there. I am puzzled by the way the media have fixed on this subject. Yes, it sells. But what are they not telling us? Have the Hong Kong protests stopped? Has the Saudi war against the Houthi ended? So far it appears that the quarantines haven't worked for the reason Mound commented on above. Does China have another motive for its hard line against the virus? Does Japan?

I'm not trying to cook up conspiracy theories; it's just that the weight of the message seems out of balance. BTW, I get my annual vaccinations.

Owen Gray said...

One of our sons lives and works in China, Toby. Another son works in South Korea. In China, they are in lockdown. One person from a family can go shopping for food. 10 people at a time are allowed in to shop for food.

In South Korea, they have delayed classes at the college where our son teaches. They're taking things seriously.

We're not where they are. But we can't be complacent. By the way, so far, our kids are fine.

Trailblazer said...

@ Toby.
I'm not trying to cook up conspiracy theories; it's just that the weight of the message seems out of balance. BTW, I get my annual vaccinations.

No conspiracy theory required other than it takes the pressure off the MSM to tackle serious issues!
Deflection if you wish.

BTW, When I have my annual physical my Doctor always asks ;have you had a flu vaccination?
I reply; have you?
He answers, NO.



The Disaffected Lib said...

Happy to hear that, Owen. On the virus issue, however, I fall back on 20-years of the climate change issue. Opinions are like sphincters. Everyone has one. The knowledge and science-based community, however, knew what they were talking about unlike Toby or kh or the rest of us. Unless and until we have some demonstrably knowledge-based reason to challenge the science, we'd do well to 'follow the science.' It's all to easy these days to lapse into illogic.

Owen Gray said...

Lots of doctors used to be heavy smokers, TB.

Owen Gray said...

We used to teach the Scientific Method in public schools, Mound. It was that method which used to give us reason to believe what science told us. I have to wonder what people know these days about the Scientific Method.