Coronavirus Capable to Affect World Economy Seriously

Coronavirus outbreak is capable to affect the global economy seriously by causing problems on supply chains, the Turkish industry and technology minister said on Wednesday.

“Chinese economy makes 20% of overall global production and it has a strategic position for supply chains,” Mustafa Varank told during the Conference on Trade and Global Value Chains, organized by the World Bank Group (WBG) in Istanbul.

“In addition to the effect of the virus on human health, it raises concerns about its potential effects on the economy,” Varank highlighted.

Uncertainties related to coronavirus are occupying the global agenda, he noted.

Thus, the world requires international cooperation more than ever, the minister added.

The virus, which was first detected in December in the city of Wuhan, the capital of central China’s Hubei province, has caused nearly 500 deaths so far, with more than 24,000 confirmed cases.

Economists expect that the virus will negatively affect the world economy by causing downfall or disruptions on several fields such as aviation, international trade, and tourism.

He said, during the last 30 years, the most important actor for shaping the global economy was global value chains.

Production networks were created for international trade and investments, to connect countries, companies, and employees, he stressed.

Integrating with the value chains improved growth, reduced poverty and supported development targets, he expressed.

He added: “But the rising trade and technology wars pose serious obstacles to global economic integration.”

Turkey is in advanced manufacturing and services league such as China, India, Mexico and Thailand, and the country provides chemicals, metals, textile products, electronic goods and vehicles for global value chains, he reminded.

The minister said it is not enough for Turkey and the country which aims to raise the price per kilogram for its exports.

“We want to move Turkey to an upper league and to rank among top global economies,” he added.  (AA)