Luis Lopez-Calva, the United Nations Development Programme (UNDP) regional director for Latin America and the Caribbean is warning that the region will be economically affected by the novel coronavirus (2019-nCoV), currently spreading across the world.
According to Lopez-Calva, the region’s supply chain will be disrupted, with the production of goods being decreased in China, because of the outbreak of the illness.
He said, “notably, the Chinese government announced that it will delay reporting its January trade data. Commodity prices will also likely be impacted by a slowdown of the Chinese economy. Chinese oil demand, for example, is already being reported to have dropped by 20 per cent by some news outlets.
“History demonstrates that in the region, volatility is the norm and not the exception.”— Luis Lopez-Calva
“History demonstrates that in the region, volatility is the norm and not the exception and that the development trajectories of countries are not monotonic. Resilience is the ability to return to a predetermined path of development in the shortest possible time after suffering from an adverse shock,” Lopez-Calva said.
According to Lopez-Calva, the economic impact of the 2019-nCoV on the region is being assessed, as it is still early to know the consequences so far, with the discovery of the illness in only December.
He said the region is significantly exposed to China as a result of economic relations, with trade between China and the region increasing from US$12b in 2000 to US$306b in 2018 and China becoming the second-largest trading partner.