The coronavirus that first appeared in China, menaces to slow the world economy and start a pandemic. Last week, some sectors in the market and the public became more optimistic on the outcome of the health crisis, given that the increase of cases in China had slowed down. At the dawn of the outbreak, China forcefully had to shutdown areas that represent 80% of its GDP and 90% of its exports, spurring work from home. The slowdown in China doesn't just represent a restraint in production, but in demand too. The demand slump refrains the "world's biggest car market" from buying, with a 92% fall in car sales. Besides, China accounts for the supplier of electronics, such as the iPhone, and a market that will neither buy phones for now, thus tanking Apple shares down. Adding up all the supply-chain disruptions, China's condition will badly hurt other economies. Their central bank has lowered interest rates to stimulate the economy, and taxes have been cut.
Now the spotlight in the outbreak is outside of China. The window to avert the pandemic, becomes smaller. Having the virus spread and spike in South Korea, the Middle East and Italy.
As of 2017, 44% of South Korea's energy consumption accounted for petroleum, ethanol and biofuels and is the eight largest oil consumer in the world. Additionally, Samsung Electronics shutdown a phone factory in South Korea due to a case of coronavirus inside it. Yet, most of Samsung's production is outside of Korea.
If the containment in Italy is to fail, they surely will face recession. It was already an imminent risk because China is Italy's third largest supplier, plenty of their citizens do tourism in Italy and buy substantial amounts of their luxury goods. Notwithstanding, now with a perceptible risk within its borders, coronavirus ill-omens Italy's economy.
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