The coronavirus has now spread to more than 120 countries and claimed more than 5,000 lives. This article was last updated on 15 March 2020.
Whereas the vast majority of known cases are in China, the virus is now spreading faster outside the country than within. Italy has currently the highest number of confirmed infections outside China.
The World Health Organization, on 11 February 2020, gave an official new name for the illness caused by the new coronavirus, namely COVID-19. The acronym stands for coronavirus disease 2019.
As of 11 February 2020, there were 45,134 confirmed cases and 1,118 deaths from the Wuhan novel coronavirus outbreak. On 14 March 2020, there were 156,653 confirmed cases and 5,617 deaths from the outbreak, a sharp increase in about just one month.
Looking for a positive trend
The growth factor of the virus is the factor by which a quantity multiplies itself over time, and is calculated by dividing every day’s cases by cases on the previous day. If the number of people infected grows by 5% every day, then we have a growth factor of 1.05, for example. A growth factor above 1 indicates an increase, while a growth factor below 1 indicates a decline.
Worldometer, which is providing useful statistics about COVID-19, reported on 11 February 2020 that daily new cases were down and the growth factor was below 1.
On 12 February 2020 Hubei decided to use a broader definition to diagnose sick people. The new definition included people as infected when they have virus symptoms, plus a CT scan showing chest infection. This resulted in a sudden huge increase in the number of cases in China, with 15,152 people diagnosed with Covid-19 in one day.
Before this change we were able to see a trend and estimate the potential trajectory of the outbreak. With the broader new definition, the trend mapping became more difficult at that time.
As we update this article on 15 March 2020, China is counting less infected people every day, while coronavirus cases and deaths in the rest of the world are climbing fast. The growth factor on 15 March 2020 was 1.14.
A rise in the number of daily confirmed cases of the new coronavirus internationally also led the WHO to declare its spread a global pandemic on 11 March 2020. This is when an infectious disease is passing easily from person to person in many parts of the world at the same time.
On 13 March 2020, the WHO said that Europe is the new epicenter of the COVID-19 pandemic as cases in China slow, and the deadly coronavirus runs through Italy and nearby countries.
Hopefully, we can soon see a growth factor below 1, as countries ramp up measures to slow down the spread of the virus.
Coronavirus impact on the economy
While we have learned a lot from SARS, which was recognized at the end of February 2003, the impact of this crisis is different. Since SARS, China has become the second-largest economy in the world, while the tourism sector in China has expanded enormously. On top of this, the COVID-19 pandemic has already surpassed SARS.
Countries have halted flights from virus-hit nations, locked-down towns, urged people to stay at home and suspended major sporting and social events. With airlines canceling flights, and businesses closing stores and plants in affected areas, GDP is expected to take a big hit. The current situation will weigh heavily on demand for commodities and petrochemicals, while the global supply chain feels the pinch.
As for the oil markets, OPEC has dramatically lowered its forecast for oil demand growth this year, citing China’s coronavirus outbreak as the major factor behind its decision. Oil markets have come under intense pressure from both worries about demand destruction as the pandemic spreads and oversupply after top exporter Saudi Arabia ramped up output and slashed prices to increase sales to consumers in Asia and Europe. A flood of low-priced oil from Saudi Arabia, the world’s largest exporter, and the United Arab Emirates is intensifying the pressure on prices after the collapse of a price supporting agreement with Russia in March 2020. On 13 March 2020, oil posted the biggest weekly loss since 2008, with the commodity closing down around 24 % for the week at 32.88 USD.
Global stock markets have also plummeted. On 11 March 2020, The Dow Jones Industrial Average closed 2,352.60 points lower, or 9.99%, at 21,200.62, or its worst drop since the 1987 Black Monday market crash.
In various emergency moves, governments around the world have started dropping their benchmark interest rates and launching new rounds of quantitative easing.
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The WHO is working closely with global experts, governments and partners to rapidly expand scientific knowledge on this new virus, to track the spread and virulence of the virus, and to provide advice to countries and individuals on measures to protect health and prevent the spread of this outbreak.
As we don’t know the outcome and duration of this crisis, companies should also prepare themselves and review their preparedness.
First of all, there are the people that sit at the very core of a business, so planning for employees to be off work through illness or other reasons is an essential consideration when developing a response plan.
Ben Hockman, head of crisis consultancy at Ricardo, wrote an interesting article titled “Coronavirus outbreak – how prepared is your business to cope with it?”
A few key points are highlighted below:
- update your business impact analysis with a clear understanding of your key products and services, and the activities that underpin them,
- ensure business continuity plans are in place and up to date,
- undertake or update your supply chain assessment so that the business has a clear understanding of the supply chain and, where required, put contingency measures in place for key suppliers,
- put crisis and pandemic response plans into action.
You can read Ben’s article here.
Containment of the virus, and getting through this crisis together, is today’s priority. Once this crisis is over, and as we always learn from bad experiences, we may see a drive towards better crisis preparedness and quality management. It’s never too late to review your preparedness while you can!
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