For many people outside of China – not least the sizeable number who have a retirement account that includes Apple stock – the impact of COVID-19 got a lot more tangible when the iPhone maker had to revise its revenue guidance earlier this week as a result of the spreading coronavirus.
While much of the world’s attention is rightly focused on the human toll of COVID-19 – including the 1,873 deaths reported as of 18 February – the economic toll of the outbreak also has potentially disastrous implications.
China, home to 99% of confirmed cases so far, has been dubbed the “world’s factory” due to the significant portion of global manufacturing that now typically takes place there. An estimated 5 million jobs in China rely on Apple manufacturing alone, and the company partly blamed slower-than-anticipated activity at its China-based iPhone manufacturing sites for the revenue warning.
Apple also blamed the warning on slowed demand for its products among China’s increasingly affluent consumers, due to store closures and reduced operating hours. And it’s not just Apple that’s been hurt by the sudden constriction of China’s massive consumer market. From South American ranchers to Vietnamese rice exporters and American farmers, a broad range of global economic players are starting to feel related effects. Thailand, where more than one-quarter of all visiting vacationers last year were Chinese, has seen its tourism industry suffer, for example.
While there has been some debate about whether the coronavirus has peaked, the contours of its vast economic toll are still taking shape.
World Economic Forum