TRADE NETWORKS FACE MENACE IN EPIDEMIC COVID-19
Student Name: Wanqun Jiang
Student Number: st20129128
Introduction
From my reading, Coronavirus is a contemporary issue that is on-going throughout the world that has influenced the way people live across the world. Basically, it is a kind of infectious respiratory disease that is caused by the newly established Coronavirus (WHO, 2020). In the majority of cases, persons infected with this virus show mild to severe cases of illness and those with mild forms may even recover without any special treatment. However, old people and other persons suffering from other medical conditions are more vulnerable to this disease. Considering my readings from the WHO, it would suggest that, people with cardiovascular conditions, diabetes, cancer and other chronic diseases have been found to develop serious illness once they are exposed to Coronavirus (WHO, 2020).
This is an on-going pandemic in the world with serious ramifications to the political economy and way of life. The pandemic has brought the whole globe to a standstill through lockdowns and travel restrictions, which have hindered business and normal way of life. This disease can better be handled through the provision of sufficient information to citizens. This is important because it will create a platform for understanding how it spreads and its causes. Thus, people who are properly informed about the disease will be able to develop strategies that will protect them from exposure to the Coronavirus. According to the WHO (2020), COVID-19 pandemic can be managed through the washing of hands using water and soap or an alcohol-based sanitiser. Also, people are discouraged from touching their face or sneezing using their handkerchiefs that breed an opportunity to spread the virus.
Studies have shown that Covid-19 is mainly spread through droplets from saliva and any fluid discharges from the nose due to coughing or sneezing. This calls for people to practically observe respiratory etiquette like coughing into the elbow to avoid any possible transmission of the disease. This contemporary issue faces a lot of problems and concerns because there is no specific vaccine or treatment (WHO, 2020). Still, a lot of trials and research activities have been focused on the issue to evaluate a possible treatment. The lack of proper treatment makes its a vital contemporary issue that needs focus because people requires a lot of information to protect themselves. This is a reflective essay that seeks to provide insights about COVID-19 so that people can use the information to protect themselves, and the government can develop necessary policies to manage its impact.
Causes of Coronavirus
According to the studies, Coronaviruses are classified as a virus that is able to cause illnesses like the common cold, severe acute respiratory syndrome (SARS) and the Middle East respiratory syndrome (MERS). Last year, COVID-19 was established as the cause of the coronavirus disease that broke out in China. Practically, the virus is classified as a form of acute respiratory syndrome coronavirus 2 also represented as (SARS-COV-2) (Adhikari et al., 2020). According to WHO (2020), the coronavirus disease was declared a global pandemic in march this year due to its faster spread and impact to the political economy of the world. A lot of information is provided to the world concerning the disease, and the information is published on the websites of the CDC and WHO. This is based on the numerous studies and research work that is based on the pandemic on the possible and best ways for preventing and treatment of the illness.
Majority of the health experts hold the belief that Coronavirus is a new strain that originated from bats and pangolins (Adhikari et al., 2020) Its first reported case of transmission was in Wuhan china, but the virus has spread throughout all parts of the world. The most common medium of transmission is through person-to-person contact that needs to be reduced to minimise its spread. According to the studies, Coronavirus is a classification of viruses that have the ability to cause disease in both animals and human beings. It is a SARS based virus that was first reported in 2002.
It is estimated that 80% of all persons affected by COVID -19 will still recover without any form of specialised treatment. Ordinarily, the majority of those who recover will experience mild symptoms that are similar to flu. According to WHO (2020), it has been extrapolated that one in every six people will experience severe symptoms of the disease that involves difficulties in breathing. Consequently, it is a contemporary pandemic issue because it has occurred when people across the world are not immune. It is an on-going issue because its spread is on-going rapidly across all countries in the world.
Studies have indicated that coronaviruses are common in certain species of animals more than others. Cattle and camels have been found to have the majority of coronaviruses cases compared to other animals. On the other hand, the transmission of coronaviruses from animals to humans is not common, but this is a new strain that is linked to have originated from bats. There are studies that have pointed at pangolins as the main possible source of Coronavirus (Adhikari et al., 2020). This indicates that the speculation about the spread of the disease is not clear, and it is not understood how it was transmitted into human beings. A good postulation is based on the chronology of seafood and animal market that is found in Wuhan. It is hypothesised that it is at this place the SARS-CoV-2 started to spread into human beings.
Influence of coronavirus
The SARs pandemic that faced China in 2002 occurred at a time when the majority of factories were agitating for low-cost goods. They hade developed a global trade network for products like T-shirts and sneakers, and the emergence of the virus was a big blow. Whereas this affected the level of trade between China and other developing countries across the world, the Coronavirus emergence 17 years later is likely to nail the last blow to the level of global trade. Unlike the SARs, Covid-19 virus is spreading rapidly across many countries in the world, and this has a major impact on global trade (Tsang, 2020). In recent times, China has identified itself as a critical player in the global trade and the emergence of the virus in China deals a blow to the fortunes already developed by the country.
(Source: Reuters, 2020)
Global companies across the world that are dependent on the Chinese factories to be able to produce their products will face the highest blow. Similarly, international companies that rely on Chinese consumers are likely to be affected by the rapid spread of the pandemic. This is because of the rapid spread and the containment measures developed by different governments will make the products costly on a global trade perspective. For example, Starbucks and Ikea are global companies that have shuttered their subsidiaries in China. Nearly all the shopping malls in China have been deserted, and this move is a direct threat to the sales of companies like Nike and McDonald’s. Other companies have delayed the production of their products like Toyota so that they can wait until a time when workers return to normal. Production of products in the manufacturing industries has been halted because of containment measures to flatten the curve of infections across many countries. Also, international airlines Like Lufthansa have cancelled fights, and this means that no activities in global trade can take place.
The Chinese economy is likely to drop in growth by about 5.6%, which is a drop from the initial growth from 6.1 last year. According to Oxford Economics, the drop in the level of economic growth is attributed to the impact of Coronavirus. This slump in the economic growth of China will result to a reduced growth of global trade by 0.2%, which means the global trade will now grow at a rate of 2.3% (Wren-Lewis, 2020). As such, the global economic growth will experience its lowest since the financial meltdown that occurred more than a decade ago.
The impact of Coronavirus to global investment cannot be ignored. It is estimated that Chinese investors will reduce their share value by 8% (Yglesias, 2020). This implies that the stock markets across the globe will reduce because of the covid-19 pandemic, and this is a recipe for an economic shock. China has decided to combat this concern through injecting additional credit into the economy. For example, the government authorised injection of $22 billion to improve the money markets and reduce the borrowing terms so that the Chinese companies can access credit (Goodman, 2020).
Chinese companies are favoured because of producing products that are simple and cheap that make global trade with other nations easier. Many countries across the world prefer Chinese clothing and plastic products because they are affordable (Goodman, 2020). As such, they have penetrated and expanded their dominance in other products like smartphones and computers. China has become a critical part of the international supply chain because of its role in producing products that are used in Mexico and parts of Malaysia (Amaro, 2020). As such, China is an integral consumer market because of its large population that use electronic products, fashions clothes and transport.
Source: Economics.rabobank.com
The emergence of coronavirus pandemic has resulted in a trade war between the US and China. This has extended to the fact that it has decoupled both countries, which are the leading economies in the world (Goodman, 2020). For example, the global companies that have relied on using Chinese factories to develop wares are now avoiding American tariffs because they are not considering moving their production to other countries like Vietnam (Feldstein, 2020). It is imperative that the covid-19 pandemic will increase this trend for a considerable period of time, especially where the international companies are restricted from doing business with China.
The outbreak of the covid-19 pandemic in Wuhan has forced the Chinese government to impose quarantine measures in its metropolis to safeguard the lives of over 11 million people who live in the city (The Economist, 2020). The level of Chinese tourism and hospitality is likely to be affected by the Coronavirus. In addition, sporting activities and concerts have been cancelled and return to normalcy is not an easy thing. The containment measures in China are likely to constrain the operations of global companies in China like Goldman.
China was a member of the World Trade Organization, which has increased its access to global markets. As such, it had harnessed on the potential of providing low-wage employees and produced consumer goods that are comparably cheaper. In this regard, its economy was basically centred on the level of exports, and the development of the consumer market was still in the infancy stage (Goodman, 2020). Through the membership of the WTO, Chinese economic output has increased to $14 trillion (World Bank, 2020). In addition, the share of global trade has continued to increase and reached 12.8%, and its economic output for every individual has increased meaning that households have additional cash to buy consumer goods. Currently, China accounts for about a third of the entire global economic growth, which shows a larger share in the global growth apart from America, Europa and Japan (OECD, 2020). For example, the semiconductor industry in the US is dependent on China. With the uncertainty about the duration of the Coronavirus, it is difficult to determine the actual impact and disruption to the Chinese economy and world trade. Another clear implication of the impact of Coronavirus to the world trade is the disruption of the supply chain (Benigno & Fornaro, 2018). For example, smart TV is likely to be manufactured with lesser components that will only be assembled in pieces. Where the widgets are dependent on China, then the production will be halted, and this is a major problem to world trade.
Implementation
There is an initial war between the US and China for the failure of the latter to observe the requirements upon joining the WTO in 2001. America has accused China of failing to impose foreign investment restrictions, IP, and subsides to its parastatals. A tariff on $ 360 billion imports from China has been imposed by the US. This relationship was worsened by the spread of the Coronavirus, which coincided with the signing of the Phase One agreement. As s result, both governments have accused each other relating to the spread of the virus. Since the US and China combined represent 40% of the entire global economy, it is critical that they need to work together to contain the pandemic (WTO, 2020).
Whereas China is blamed for slow reporting about the disease, the US is also responsible for the pandemic. Last year, the US had levied punitive tariffs on all medical product imports from China, meaning that it reduced the US supply leading to the current shortage. The US administration still downplayed the advice of the WHO. This latter advice would form an important part of making preparations of the cities to the impending crisis. As such, the implementation should see both US and China undertake cooperative research and provide data that will manage the impacts of the pandemic (WTO, 2020).
With the loggerheads about the two leading economies in the world, it is clear that their foreign policy will focus on promoting cooperation with other nations. Here, the WTO has an enormous role in advising governments about ways of managing global trade. This not the case because WTO has been impacted negatively by unilateralism of Trump and the economic nationalism advanced by China. However, WTO can be used to fight the impacts of the pandemic through restricting bans on medicines which have a legal basis according to the WTO regulations. It is imperative that WTO should implement measures to increase the level of transparency to the containment measures of covid-19. Also, WTO should scrap the buy local requirements that are likely to be abused through inflating prices. Other important roles of WTO include promoting trade facilitation, minimising red-tapes, eliminating any non-tariff barriers, adopting global trade standards for safety and quality of medical products and amending WTO rules for permitting mandatory licensing to end Coronavirus (WTO, 2020). Lastly, the need for targeted economic policies should be implemented as fundamental for managing the pandemic. WTO needs to implement fiscal policies that will anchor the country’s economies so that they do not plunge into a permanent crisis.
Conclusion: Analysis and Reflection
The influence of coronavirus pandemic is an important topic on the political economy of the world. Evidence has shown that the pandemic was first reported in China, and it has spread to other countries across the world. Considering the information about Coronavirus I have read from studies and government mitigation measures; this is an important topic that discusses the contemporary issues in China and other parts of the word. The influence and effects of the Coronavirus have spread across many countries in the world, and this topic will create a proper platform to discuss the real effects of the pandemic as an on-going contemporary issue.
The Coronavirus is a matter that is directly linked to national and international politics of the world. Similarly, it has resulted in confrontations to friendly relations and the possibility of developing a recession in the global economy. The massive outbreak of the Coronavirus, which is an infectious respiratory disease has resulted in negative consequences to the social economy. Many governments have been involved in developing measures that will reduce its spread. For instance, cessation of movement, social distancing and greetings have been restricted. This is an important activity in the society that promote the social life of people in the economy. Through these measures, the social economy of the people has been affected. Because people have been restricted from moving from one place to another, their levels of social being are affected. This has been observed as increased cases of gender-based violence in the homes because of lacking the socialisation factor in the society.
Practically, the curtailing measures have directly struck the core of social, economic development, especially to the main factor of production, which is human labour. Restrictions of movements and closed borders have made it difficult for the social economy to progress. Majority of the national economies have come to a standstill because of the lockdowns imposed to the citizens. As such, as a national consequence to the Chinese consumers, factories manufacture their products and depend on the consumers to buy their products. With travel restrictions and lockdowns, they have experienced costly problems. Education has also been hit hard because of the influence of coronavirus restrictions. All students learning in China from other countries have been evacuated back to their countries, and the Chinese in other countries have returned. This has influenced learning because the entire process of learning has been halted. Similarly, the education institutions are being used as isolation facilities, and this makes it difficult to reopen schools at a period the pandemic is still spiking.
The political influence of the Coronavirus pandemic is great on an international scale. For example, the schools in Japan and France have stopped exchange programmes with China because of the fear created by the pandemic. Students from other countries who were studying in China have either left the country or planning to be evacuated by their respective governments. This is serious problems with economic impacts, but result in bad ties with China for fear of being infected. Similarly, the deaths, job losses, negative growth of the GDP and possibility of a recession have made it difficult for some counties to operate optimally. For example, North Korea, Turkey, Pakistan, South Korea, Saudi Arabia and Japan have failed to cope with the long-term epidemic currently on-going in China. Whereas, this a direct impact created by the pandemic, an indirect consequence of a global economic recession is predicted. Therefore, this is a typical example of how a health pandemic can affect global society. As such, the influence of the Coronavirus to the world is a clear replicate that other epidemics can cause to the world trade.
This was an important topic because Coronavirus is a new disease that has never been experienced anywhere in the world. This implies that the findings of this study provide an actual position of actual findings in the context of globalisation. At the onset of the global health pandemic, it was perceived as a recurrent of the SARs pandemic, but this was a new strain of the virus (Adhikari et al., 2020). China had grown to a reputable global economy with many international ties before the coronavirus pandemic. It was producing gods in entirely all sectors of the economy for export to other countries in the world. However, the influence of the coronavirus pandemic means that China has lost its international ties. Currently, it is being blamed for developing and spreading the Coronavirus to other parts of the world.
Currently, the situation created by the coronavirus pandemic has not changed because there is no vaccine or treatment. This points at a possibility of the disease progressing and causing severe impacts to the global society. In the event the pandemic situation worsening, these will be a global issue that will have the same effect as Chernobyl, the 9/11 incident to the US and the global economic recession in 2008. The influence of Coronavirus is not just a factor in causing a global recession, but it can ignite another global war. For example, the US is blaming China as the source of the Coronavirus and should be punished for transmitting the virus to other countries. In this regard, there is a lot of fake news about the influence and impact of the Coronavirus. Some countries have failed to disclose the actual number of fatalities. China is an example where many people have doubted the number of deaths announced by the government. With the war of words on the offing, it is likely that this pandemic will result in a full-blown war. As such, the reality of the pandemic to the political, social and economic ramifications of the world makes it an important topic. This study has indicated that the pandemic is a serious issue that is not only confined to China but has spread to many countries across the world. Through its negative to relationships between countries, it is important for people to understand the impact of health pandemic on global trade. This study has shown the impact of infectious diseases on the world trade and how it can be mitigated. The earlier health pandemic provided by Ebola and SARS has not achieved the same influence as a coronavirus (Afhikari et al., 2020). The latter spreads very fast, and it has affected a greater number of people compared with the others. Since it is still an on-going contemporary issue, the influence of Coronavirus to the word trade will be higher compared to other health pandemics. Therefore, this reflection has found out that the impact of the new strain of Coronavirus to the global economy is limited because it is an on-going issue, and a lot of information is still not available. The WHO and CDC will focus on new studies and research to provide people with evidence and information so that it can be used as an approach to prevent and control the pandemic and reduce panic.
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