The Coronavirus Is Infecting Global Supply Chains

The Coronavirus Is Infecting Global Supply Chains

As you read this post, the coronavirus will have upended more business activity than reported in this article.

British Airways, Air Canada, Apple, Starbucks, Ikea, and other international, corporate giants have already frozen some of their operations in China as the coronavirus claims more lives and increases business risk as well as uncertainty. The crisis highlights the role of China as an engine of global economic growth. Foreign companies’ investment concentration in Wuhan, the epicenter of the outbreak, challenges the notion of an easy pullout. In the same vein, the travel restrictions placed on Chinese citizens underscore Chinese tourists’ economic impact all over the world.

Video Spotlight: Business Impact of Coronavirus

This post is based on The New York Times article, Coronavirus Outbreak Tests World’s Dependence on China, by A. Stevenson, January 29, 2020, and the YouTube video, Coronavirus to Pose a Threat to Global Supply Chains: Economistby BNN Bloomberg, January 29, 2020. Image source: Mick Ryan/Cultura RF/Getty Images.

Discussion Questions:

1. How does halting manufacturing in China affect economic growth in the United States?

Guidance: US manufacturing firms with production facilities in China may have a lower output and therefore productivity. Furthermore, their sales Continue reading