What if the most terrible scenarios about the Wuhan coronavirus come true, and the disease outpaces the measures taken by the international community and China itself? The peak of the new epidemic in China may come in this month; with that in mind, let us think about the possible geopolitical and geoeconomic consequences.
The coronavirus outbreak coincided with an economic slowdown as China contends with rising debt, cooling domestic demand, and aggressive U.S. tariffs. The 6.1 percent GDP growth rate for 2019 was near the bottom of Beijing's target range, and sharply down on last year's 6.6 percent. On Jan. 15, China and the United States signed an interim trade deal, the first steps toward the end of U.S.-China trade war. But the celebration was short-lived, as days later the severity of the coronavirus began to become clear.
Wuhan, the capital of Hubei province, is at the center of the Chinese industrial heartland. Whereas the national economy of China saw a growth slowdown in 2019, Wuhan saw higher growth at 7.8 percent. Wuhan's prospects looked bright for 2020 as well. As the Hubei government noted, "Over 300 of the world's top 500 companies have settled in Wuhan. The number of newly-added high-tech companies hit a record high with a net increase of about 900."