Shanghai Institute Analyzes the Effect of Coronavirus Epidemic on China’s Economy

Feb. 3, 2020 (EIRNS)—Despite flagrant panic-mongering by major national media in other countries, and dangerous blends of geopolitical schadenfreude and outright racism coming from those media, China continues to be a nation defending the world—so far, effectively—from the attack of the novel coronavirus (2019-nCoV) epidemic there. The World Health Organization has stated this. During Sunday, Feb. 2 WHO said there were no new cases confirmed outside China, despite 2,900 new cases within it. Some 99.3% of cases known are in China, and 63% of them in one province, Hubei, whose leading cities are under complete quarantine. Medical observation there involves 137,000 people. Within China, the number of new infections confirmed each day continues to increase, and the global total reached 17,206 as of Monday morning Beijing time; 361 had died, all but one in China.

An intensive study of the epidemic was published by the Shanghai Institute of International Studies (SIIS) Jan. 31, and also presented a sober picture of what China’s economy is experiencing. Writing on China-U.S. Focus website, SIIS President Chen Dongxiao reports:

“[I]t is believed that at a critical moment for international political and economic dynamics and China’s economic transformation, the 2019-nCoV epidemic will have much negative impact on China’s economy (especially in the short run), as well as on world economy in many ways. However, in the mid- and long term, China’s economy will manifest strong surprising resilience; with the support of the international community, the Chinese government and people will ultimately conquer the epidemic and China’s economy will remain robust.”

It is reported separately that 24 provinces accounting for the vast majority of China’s GDP will shut businesses and work again this week.

SIIS’s Chen also states:

“It is worth noting, however, that the potential impact of the 2019-nCoV epidemic can be different from all the previous epidemics and other incidents. For one thing, it occurs when China’s economy, in the midst of a transition from high-speed growth to high-quality development, faces three daunting tasks domestically, i.e., guarding against systemic financial risks, control of pollution, and poverty eradication; externally, with globalization under unprecedented challenges and China-U.S. trade frictions only starting to ease, China’s economy will be further hit if the country is labeled as an ‘epidemic area.’ ”

The study considers that the epidemic may affect implementation of the U.S.-China phase-one trade deal, but only in the short term. It also states that China must increase its imports of medical supplies and medical/diagnostic devices in that short term, and the United States may be able to supply them.