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How China’s coronavirus outbreak impacts the global economy
Chinese markets tumbled upon its return from the extended Lunar New Year holiday following the global crisis of the Coronavirus. Joining CNBC Africa for more on this and the industries set to be affected by the virus outbreak is Stephan Engelbrecht, Fund Manager at Anchor Capital.
Tue, 04 Feb 2020 09:53:15 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- The coronavirus outbreak in China could lead to a 2% hit on the country's GDP growth in the first quarter, affecting global markets and trade.
- Various industries, including oil, tourism, and luxury sales, are already feeling the impact of the virus, with disruptions in supply chains and consumer activity.
- South Africa's markets are vulnerable to the global economic slowdown caused by the virus, highlighting the interconnected nature of the world economy.
The outbreak of the coronavirus in China has sent shockwaves through global markets, with the Chinese government struggling to contain the spread of the disease. The impact of the virus on the Chinese economy is significant, with experts predicting a possible 2% hit on the country's GDP growth in the first quarter. This could potentially lower China's GDP growth rate from 6.5% to less than 4.5%, a drastic decrease that could have global repercussions. Stephan Engelbrecht, a fund manager at Anchor Capital, highlighted the potential long-term effects of the virus on the global economy during a recent interview on CNBC Africa. He discussed the implications for various industries, including oil, tourism, luxury sales, and global trade. Engelbrecht also weighed in on the impact of the virus on South Africa's markets and industries, emphasizing the interconnectedness of the global economy. The interview shed light on the challenges and opportunities presented by the coronavirus outbreak and its implications for the world economy. One of the key points raised in the interview was the impact of the virus on global trade and industrial output. With China being a major consumer of oil and commodities, a slowdown in its economy could have a ripple effect on these sectors. The restriction of movement in China during the Lunar New Year holiday also affected tourism and luxury sales companies, leading to closures and financial losses. The airline industry has also been hit hard, with companies like Apple and Starbucks closing stores due to reduced consumer traffic. The interview also touched on the potential impact of the virus on South Africa's markets, particularly in terms of global trade and economic growth. If the coronavirus continues to spread and disrupt global supply chains, South Africa could face challenges in maintaining economic stability. Engelbrecht highlighted the importance of secure electricity supply for companies, especially in industries like mining. He discussed the potential benefits of self-generation for businesses in terms of cost savings and operational efficiency. Engelbrecht also shared insights on investment opportunities in the current economic climate, suggesting a cautious approach to stocks like Sasol and highlighting the potential of companies like Investec. Overall, the interview provided valuable insights into the complex interplay between the coronavirus outbreak, global markets, and economic growth. As the world grapples with the challenges posed by the virus, experts like Stephan Engelbrecht offer valuable perspectives on navigating the uncertain terrain of the global economy.
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