São Paulo – Coronavirus could result in a USD 50 billion loss across global value chains, according to estimates published by the United Nations Conference on Trade and Development (UNCTAD). The loss could result mainly from the slowdown of manufacturing in China and be felt in the value chains across the globe.
UNCTAD secretary-general Mukhisa Kituyi said that the outbreak carries serious risks for the global economy. The Chinese manufacturing index fell to the lowest reading since 2004. Such a drop implies a 2% reduction in exports from the country. Because China has become a central manufacturing and trade hub, this has repercussions for any given country, especially those who have a closer relation to the Chinese.
According to UNCTAD, the most affected sectors will be precision instruments, machinery, and automotive and communication equipment, and the most affected economies will be the European Union (USD 15.6 billion), United States (USD 5.8 billion), and Japan (USD 5.2 billion).
Translated by Guilherme Miranda
