Coronavirus: Economic Impact On Germany, Australia, Africa

coronavirus economic impact Germany Australia Africa

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Coronavirus is now a global phenomenon that has already affected about 25 countries. The new virus has already surpassed the SARS crisis in terms of the death toll. Moreover, its economic impact will also be far-reaching not just for China, but for other countries as well. Let’s have a look at how coronavirus could have an economic impact on Germany, Australia, and Africa.

Economic impact of coronavirus on Germany

Though the numbers of coronavirus cases are very few in Europe, the region would still feel the economic impact. Many believe the impact could be enough to push Germany’s economy, which is already vulnerable, and the entire eurozone, into a recession.

Things won’t return to normal at least until China resumes the export of essential factory goods at the same level as before. On the other hand, it is also important that China resumes its role as an important consumer market.

For instance, Daimler (DDAIF), which is an important German company, has many manufacturing plants in China. Though the company has restarted production, uncertainty still looms. Moreover, the coronavirus could exacerbate financial troubles for Daimler, which reported a loss for the fourth quarter of 2019 owing to penalties from diesel emissions cheating and the cost of new technologies.

Germany is known for its vehicles, which are also its biggest export. Experts believe that the fourth-quarter data is not expected to speak well about the country’s economic growth due to the slowdown in manufacturing.

Since vehicles are a significant part of the German economy, it would have an impact on other sectors and other countries in the eurozone as well. Several small and midsize auto parts makers depend on German automakers for sales. For instance, Italy’s economy shrank in the last quarter partly because many of its industries depend heavily on Germany.

“For most countries, Germany is the most important trading partner,” chief economist at ING Germany and TalkMarkets contributor, Carsten Brzeski said, according to The New York Times. “If it starts to slow down, other countries will feel it.”

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Marcy Brown 1 month ago Member's comment

Scary!