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Economic Crisis created by the coronavirus - Coggle Diagram
Economic Crisis created by the coronavirus
Introduction
Covid-19 also affgects global economy
This caused a decrease in the world’s workforce
with a decay of 81% of the world’s working capacity
3.3 billion people had their workplace fully or partially closed.
First appearance of a coronavirus wave
was in 2002
pread of SARS-CoV
originated in the province of Yunnan
this started an epidemic outbreak in the province of Guangdong during November of 2002.
China’s Economic Slowdown
The SARS covid outbreak in the year of 2003
brought a problem to the economic growth of the then sixth greatest economy in the world.
Reprecussions were evidenced on the drop of efficiency and growth.
in the country, dragging it down to 11.1% in the first quarter of 2003
and in the following three months sunk to a 9.1%.
this effect was rebounded
when in the following year the country showed an economic growth of 10%.
Fall in retail sales growth
The retail sector was one of the sectors more affected by the small crisis in 2003
where the growth in sales dropped to 4.3% in May 2003.
one of the slowest pace on record according to Refinitiv.
However as seen in the economic growth this situation in the retail market bounced back after the crisis ended
Hit to industrial output
The industrial growth was also hit by the epidemic, which caused a slower production.
this drop from almost 20% to 13.7% WAS the slowest expansion seen in the recent decade.
However, this problem was solved by the Chinese government in the next few months.
Steady trade volume
The growth in imported goods showed a great decrease due to the coronavirus
this decrease was from 63% of imported goods in value of trade
dropping to a value of 35% in only 3 months
While the exported goods did not seem to change until May of 2003
where a mild decrease was shown in the picture
both goods increased their value after the epidemic was controlled by the government
and showed a serious increase of its value at the end of 2003.
Background and recent events before COVID
Oil price crisis generated by disputes in the OPEP
In March there was a decay of 30% on the prices of crude petroleum
It was due to a conflict between Saudi Arabia and Russia after the collapse of the arrangements regarding the cuts on the pumping of petroleum,
which made Saudi Arabia increase the production of oil and the extraction of crude.
This led to a conflict between the members of the OPEP
that was solved by the OPEP and their allies by limiting production to 9,7 barrels daily beginning from May 1st.
The China–United States trade war
is an ongoing economic conflict between China and the United States.
President Donald Trump in 2018 began setting tariffs and other trade barriers on China with the goal of forcing it to make changes.
In response to US trade measures, the Chinese government has accused the Trump administration of engaging in protectionism.
Nearly all economists who responded to surveys conducted by the Associated Press and Reuters
said that Trump's tariffs would do more harm than good to the economy of the United States
The trade war has negatively impacted the economies of both the United States and China
In China, the trade war contributed to a slowdown in the rate of economic and industrial output growth, which had already been on a dec
Internationally, there has been strong support for the end goal of the Trump administration's trade war of trying to change China's trade policies
The beginning of the pandemic
On December 31 of 2019 there was a case of Pneumonia in Wuhan
Hubei Province, which became the first case of many to come off the deadly SARS-Cov2.
The shock of the new virus forced the Chinese government to share the genetic sequence of the COVID - 19.
The Chinese government didn’t take any measures in order to keep the economy safe without any kind of repercussions as it had done in 2003.
The Chinese government didn’t take any economic measures until February 3rd
when the People’s Bank launched a public market reverse repurchase operation with a budget of 1.2 trillion Yuan.
Future Prospects
According to the United Nations there are 4 necessary measures to balance the economy after this crisis
Two way out
one is to absorb the crisis and get used to the world’s present situation
take political and economic measures that aid the actual economic failures of current systems.
In both cases the most probable resolution is to get a slow but steady recession in the sectors that were most affected by the crisis
Structural measures
For a second exit from the crisis, the economic consequences related to the virus are less about the time and confidence
and more about a question of leadership and political coordination.
These two elements are necessary to stop the waves of economic pathogens released by the crisis
The abnormal new law
The last decade has been marked by a growing sense of economic anxiety due to a vertiginous recovery in the North
and a general slowdown in the South that have been threatening the world economy since the financial crisis of 2008-2009
Behind this is a longer period of investment and slow growth
Reduce inequality
Rising inequalities over several decades have eroded the purchasing power of most households since long before the Covid-19 outbreak.