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China will be a key player in reshaping global economy after Covid-19 crisis

The benefits of free and open movement of people and trade is well proven for growth and development, so will continue to be embraced

Covid-19 is unlike any disease the world has experienced in living memory. Severe acute respiratory syndrome (Sars), Ebola and Zika were largely confined to particular regions, while the latest coronavirus is a pandemic with a truly global impact. The result of the sealing of borders to prevent the infection from spreading has had devastating consequences in a multinational system of trade, business and travel. There are bound to be pressures on globalisation when restrictions are lifted and governments have to navigate them carefully to avoid a rolling back of the achievements that have come about through the open movement of people and goods.

China has to be especially mindful of the changed conditions and circumstances. The pandemic has highlighted how reliant the world has become on Chinese products; the disruption to supply chains and shortages of urgently needed items such as face masks and ventilators spurred local manufacturing in other countries and raised questions about excessive dependence.

A complication has been added by United States President Donald Trump and his administration, who have hit out at China’s role in the pandemic. No nation has the know-how and capacity to turn out what the world’s consumers need in such volume and quantity, so a concerted effort has to be made to shore up trust and alleviate concerns.

There are obvious challenges given the extent of the disruptions caused by lockdowns and social-distancing policies. Most of the world’s biggest economies were the first hit; the US, China, Japan, Germany, Italy and South Korea account for 55 per cent of global GDP and half of manufacturing exports. World trade has not been impacted in such a manner since the Great Depression in the 1930s.

Robotics and artificial intelligence are bound to spur domestic manufacturing and businesses that lessen China’s production advantages. Social distancing has also blunted appetites for aviation, tourism, hospitality and other people-oriented businesses. These are temporary changes, but they may become longer-term due to preferences and health concerns.

Multilateral bodies like the United Nations, World Trade Organisation, Group of 20, International Monetary Fund and World Health Organisation will also come under particular scrutiny. Too often, citizens have relied on national governments for help during the Covid-19 crisis.

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