The coronavirus outbreak could wipe $1.1 trillion, or 1.3 percent, from the global economy if it turns into a global pandemic, according to an analysis by Oxford Economics.
If the pandemic is restricted to Asia, then the fall in global gross domestic product (GDP) would be 0.5 percent ($0.4 trillion), the report said.
Oxford Economics has pegged global economic growth in 2020 to slide to 2.3 percent, the weakest since 2009.
The WHO has declared the outbreak of the novel coronavirus a "public health emergency of international concern," but has not yet termed it a pandemic. The last official pandemic was the H1N1 flu pandemic in 2009.
The virus, officially called COVID-19, has killed over 2,700 people and infected nearly 80,000 in mainland China alone. Iran, South Korea and Iran have reported the highest number of confirmed cases of the infection outside of China.
Frequently Asked Questions
A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.
There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.
Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.
The outbreak has caused several factories to pause operations, and affected daily business in major financial centres such as Shanghai, Beijing and Hong Kong. Fears of a pandemic have caused global markets to plunge.
The outbreak will have a significant impact on China's GDP growth, with Oxford Economics projecting the country’s Q1 growth to drop to 3.8 percent.
“While there were signs in early 2020 that the worst was over for world trade and manufacturing, that optimism has been dashed by the outbreak,” the report stated.