A report by Dun & Bradstreet, the largest business information company in the world, highlights the enormous economic and third-party risk of the coronavirus outbreak.
With operations closing in China, travel bans imposed by airlines and MWC cancelled last week amid a round of high-profile cancellations, the full impact of the virus is becoming more apparent every day.
Some of the key findings from the report show:
- Dun & Bradstreet data indicates that the most impacted provinces account for over 90 percent of all active businesses in China (~50,000 businesses are branches and subsidiaries of foreign companies). Guangdong, Jiangsu, Zhejiang, Beijing, and Shandong provinces account for 50 percent of total employment and 48 percent of total sales volume for China’s economy
- At least 51,000 (163 Fortune 1000) companies around the world have one or more direct Tier 1 suppliers in the impacted region, and at least five million companies (938 Fortune 1000) around the world have one or more Tier 2 suppliers in the impacted region
- The top five major sectors that account for over 80 percent of the businesses within the impacted provinces include services (personal and business), wholesale trade, manufacturing, retail, and financial services. Among these sectors, services, wholesale, and manufacturing account for approximately 65 percent of the businesses in the impacted region
- With the impact of the outbreak on the Chinese economy – which makes up about 20 percent of global Gross Domestic Product (GDP) – the cascading effect might cause a drag of approximately one percentage point on global GDP growth if containment is delayed beyond the summer of 2020
Markus Kuger, Chief Economist, Dun & Bradstreet