The rapid spread of the novel coronavirus Covid-19 is expected to weaken China’s growth sharply in the short-term, causing global disruption.
This is according to Orxford Economics, which points out that optimism about 2020 bringing relief for world trade and manufacturing has been dashed by the outbreak.
In China, the analyst company expects the near-term impact to see Q1 growth plunge to just 3,8% year on year.
Although growth should then rebound, it will take time for the loss in activity to be fully recovered. As a result, Oxford Economics has cut its 2020 China growth forecast by 0,6 percentage points to just 5,4%.
It expects global conditions to strengthen in the second half of the year as the disruption fades.
However, it is now projecting 2020 global growth will slow to just 2,3% – its weakest since 2009.