Corona Scare, Scar And Care

The humanity is scarred and humans are scared as Covid 19 infectivity spreads across nations. The care taken to curb Corona has chopped the global supply chains emerging from China. There are varied estimates of the economic impact on the global economy that will prolong the pain to the mankind even after the virus has been quelled. Big fiscal and monetary stimulus announcements have been made. With US announcing S1 trillion; UK $400 mn; Germany $600 mn; IMF $1 tn, the world is expecting to see more than $ 4 tn spend in response to curb the agony of the people. The impact on Chinese population is going to be quite severe and prolonged despite such stimulus as many of those establishments, which have been nursing the global supply chain, may not ever revive again. In order to save rest of the world from prolonged agony, the supply chains will get relocated to other parts of the world. In pursuit of low-cost manufacturing the world had transformed China into “the World’s Factory”, ignoring the basic tenet of risk management – don’t put all eggs in the same basket, diversify. We might see this anomaly getting corrected now.

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