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29 Jan, 2020 09:01

Coronavirus could hit global economy harder than SARS – rating agency

Coronavirus could hit global economy harder than SARS – rating agency

The deadly coronavirus could have a far more significant effect on the world economy than the severe acute respiratory syndrome (SARS) did in 2003, says the Russian National Credit Ratings (NCR) agency.

According to NCR as cited by TASS, “Even a minor fall in the Chinese economy may add to the volatility of the world oil market and global trade.”

The agency explained that “The number of tourist and business trips to China is dwindling. The first bans have been introduced already, which will influence the industries servicing tourists and businessmen.”

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The report adds: “Logistic restrictions may hit other industries of the Chinese economy in the near future, which will harm the trade turnover with the biggest trading partners.”

According to the rating agency, China’s GDP could drop this year by approximately 0.5 percent to 5.6 percent as a result of the outbreak.

"The coronavirus has already infected world markets of commodities, including Russia’s most important oil market. The price of Brent crude has been down $9.7 (14 percent) per barrel this year, largely on news from China. In February-May 2003 oil was down by one-third to $23.4 per barrel. The main reason then was Iraq, and not SARS," the agency said.

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According to China’s national health commission, the new virus has already claimed over 100 lives and infected more than 5,970 people.

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