(Philippines) – A brief recently released by the Asian Development Bank, ADB, has suggested that the ongoing COVID-19 outbreak could have an impact of US$347 billion on global economies.
The ADB brief titled, ‘The Economic Impact of the COVID-19 Outbreak on Developing Asia’, noted that the magnitude of the economic impact will depend on how the outbreak evolves. It added, “Rather than focusing on a single estimate, it is important to explore a range of scenarios, assess the impact conditional on these scenarios materialising, and to update the scenarios as needed.”
The Bank created a scenario matrix that included ‘best’, ‘moderate’, ‘worse’ and ‘hypothetical worse’ case scenarios to estimate the economic impact that could occur as a result of the epidemic.
The brief noted that following an exploration of the scenarios, a suggested COVID-19 global impact of $77 billion to $347 billion – or 0.1 percent to 0.4 percent of global GDP – could arise. ADB went on to suggest a moderate case estimate would have a global impact of $156 billion, or 0.2 percent of global GDP.
“Two-thirds of the impact falls on the People’s Republic of China, where the outbreak has been concentrated so far,” it added.
The Bank went on to explain that the COVID-19 outbreak affects China and other developing Asian economies through various channels, including sharp declines in domestic demand, lower tourism and business travel, trade and production linkages, supply disruptions, and health effects.
“ADB developing members that will be significantly affected are those with strong trade and production linkages with China,” it added, noting the impacted economies as Hong Kong, Mongolia, Philippines, Singapore, Taipei and Vietnam.