After a weak 2019 for most regions, driven in large part by weak Chinese import demand, 2020 was expected to be a recovery year for the global economy. But the coronavirus outbreak has already led to a significant downward revision to our China growth forecasts for 2020, from 5.9% to 5.4%—and that is assuming China is able to control the outbreak.
The slowdown in China in 2020 imperils the global economy in 2020, though the impact will be felt differently across regions. For major commodity exports of oil and cyclical metals, weaker Chinese demand will lead to some combination of higher inventories, production cuts, and lower prices. For exporters of manufactured goods into China or in related supply chains—mainly an issue in APAC, Western Europe, and CEE—weaker exports will lead to ongoing price pressures and continued weakness in industrial production due to a slower-than-expected rate of inventory depletion. Firms need to adjust 2020 plans for the slowdown in China and the ripple effects across the global economy, and prepare contingency plans should the coronavirus outbreak prove difficult to control.
Join DuckerFrontier for an interactive webinar, What Coronavirus Means for Multinationals’ Plans in 2020, that explores our scenarios for how the coronavirus could affect China’s economy over the coming months and what impact this will have on different geographies globally.
Please click the link below to register for the time of your choosing:
Adam Jarczyk, Director for APAC research, and Ryan Connelly, Practice Leader for Global Economics and Scenarios will present our latest analysis and quantitative scenarios as well as share insights about implications for multinationals across different geographies, customer segments, and operational challenges firms are likely to face. There will also be a live Q&A session at the end of each presentation, where you can submit your questions to our experts.
We are currently conducting additional research into the coronavirus’ impact on China’s economy and business environment. FrontierView clients can download the latest Global Leadership Briefing for our most up-to-date coverage on the coronavirus.
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