The warning comes as the world comes to grips with the uncertainty caused by the spread of the virus that has killed hundreds in mainland China.
China warned other countries on Tuesday that an “overreaction” to the impact of the coronavirus outbreak through trade restrictions could have a negative impact on the global economy.
Beijing made the statement at a meeting of the World Trade Organization, where it noted that it is a large contributor to global economic output and growth, according to a Geneva-based trade official.
The warning comes as the world comes to grips with the uncertainty caused by the spread of the virus that has killed hundreds in mainland China.
“Many companies were unprepared for this level of event and hadn’t really thought that a shutdown of a significant proportion of China’s production capacity was really something they needed to prepare for,” said Jake Parker, senior vice president for the U.S.-China Business Council.
Federal Reserve Chair Jerome Powell said Tuesday that there will “very likely be some effects on the United States” from the virus.
“Some of the uncertainties around trade have diminished recently, but risks to the outlook remain,” he said. “In particular, we are closely monitoring the emergence of the coronavirus, which could lead to disruptions in China that spill over to the rest of the global economy.”
The initial spread of the virus occurred during China’s Lunar New Year holiday when most offices and factories are closed for at least a week, but production is slow to ramp back up as workers have been advised to stay home.
China’s government also provided its first confirmation on Tuesday that the spread of the virus could affect its compliance with purchase commitments as part of the phase one trade deal with the United States.
The Ministry of Agriculture and Rural Affairs outlook committee said China could delay the implementation of U.S. farm product purchases initially but would fulfill a commitment to purchase as much as $50 billion worth of U.S. agricultural goods within a year, Bloomberg reported.
The U.S. has not issued a quarantine order on imports of Chinese goods, although there is a ban on foreigners trying to enter the U.S. from China.
Parker said the virus has also negatively affected the movement of goods to Chinese ports. Chinese provinces have set up checkpoints at their borders where drivers are stopped and checked or, in some cases, quarantined for a two-week period.
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