Coronavirus is deeply affecting the global trade

The outbreak of Covid-19 leaves deep marks in the global trade. In its Economic Quarterly Report, Rabobank (The Netherlands) anticipates that economic growth will fall this year. In a risk scenario of a pandemic with major outbreaks in all major economies, Rabobank expects GDP to fall by 0.2 percent.

According to the report, Rabobank expects global economic growth to reach 1.6 percent in 2020 and 3.2 percent in 2021. Besides China, emerging markets are currently experiencing the most economic pain. In a pandemic risk scenario, economic losses could roughly double in 2020. The economic crisis in the risk scenario could lead to cash flow problems for companies worldwide, which would jeopardize financial stability. A robust policy response from central banks and governments should then prevent a health crisis from also causing a financial crisis.

The corona virus has a major impact on the global economy. China will grow much less rapidly as the epicenter of the virus, but other countries where the virus is not widespread will also be affected by uncertainty among consumers and companies.