Covid19 / The wider impact on the global value chain
The economic impact of the Coronavirus on commerce and tourism, and thus on GDP and growth, is evident but there are other more subtle impacts, as explains Italo Colantone, professor of economics and expert in international trade and economics. “These are related to how companies organize activities in the global economy, how they are coordinated and connected between countries. If a factory, or a whole region, in China shuts down it has effects around the world. It is estimated 94% of major US companies will face issues in the coming weeks. All this leads to great uncertainty and with it being so difficult to predict how the shock will evolve it has effects on investments and growth.”