how coronavirus affected internationally
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The Covid-19 virus is the latest factor affecting international trade and according to experts, it’s creating a grim economic outlook for the future of global trade too.
The virus has now infected over 125,000 people and the death toll has surpassed 4,000 worldwide, with both expected to rise as the outbreak spreads. Efforts are being made to develop a cure for the virus, which is more dangerous for the elderly and people with weakened immune systems, but no resounding progress has been made yet.
Governments are struggling to cope with the challenges the virus poses to the global economy and with the social disruption that has befallen on the world. Not only has the coronavirus initiated a global health crisis but having originated in China, which is a central manufacturing hub for many businesses across the world, the repercussions of their halted economy is going to disrupt international trade and global shipping.
coronavirus-affecting-businesses
Coronavirus Continues to Threaten Businesses
Many businesses are now operating on a ‘just in time’ model by relying on regular imports and holding low stock of products, ingredients or materials for international trade to reduce warehouse costs. This has resulted in labour deficits and a deceleration in production time as businesses are using global shipping services on a means necessary basis. As a result, less goods are being exported and at the importing stage of the cycle, heavy quarantine procedures/health checks are being carried out at ports which is prolonging the delay.
Businesses aren’t the only ones reluctant to spend too, as recent Gross Domestic Product (GDP) growth figures have shown a decline in consumer spending across the globe. This has become most apparent in the retail and tourism sectors, perhaps due to a loss of income, fear of contagion or increased anxiety around the virus’s developments. This is a barrier to international trade as lower demand limits production which could result in job cuts as well as reduced shares.
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The Covid-19 virus is the latest factor affecting international trade and according to experts, it’s creating a grim economic outlook for the future of global trade too.