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Coronavirus pandemic
OpinionComment
Neal Kimberley
Neal Kimberley

Coronavirus: As crisis drags on, cracks show in global supply chains

  • After decades of offshoring manufacturing to China, the disruption to supply chains caused by the Covid-19 outbreak may prompt some sectors to consider diversifying production
  • The car and smartphone industries have proved quite vulnerable

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Rows of Hyundai cars are parked for shipping in the southeastern port of Ulsan in South Korea. Hyundai has suspended work at a factory in Ulsan, hamstrung by a lack of parts as the coronavirus outbreak cripples China’s industrial output. Photo: AFP
Neal Kimberley
China’s Foreign Minister Wang Yi believes that the adverse effects of the coronavirus on the Chinese economy will be temporary. There’s no reason why that shouldn’t be the case. But that doesn’t mean there won’t be consequences, both at a domestic and an international level. 

“I believe, once the epidemic is over, the depressed consumption demand will be unleashed quickly, and the economic momentum will have a resilient rebound,” Wang said in Germany last Thursday.

Of course, once the epidemic is over, there must also be an investigation into why and how the outbreak began and spread in the first place.
Public disquiet about the way local officials reacted to the outbreak in Wuhan won’t be assuaged simply by the removal of senior officials from office in Hubei province. The central government needs to reinforce its political legitimacy, and it is in its own best interests to follow up on the botched local response and usher in systemic reform at the national level.

Political legitimacy matters, even under China’s system of government. But it can be built on a number of different foundations.

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