Wuhan Virus Lockdown Casts Cloud Over Industry…

Complicated supply chains and just-in-time production could mean that production outages in Wuhan factories have broader spillover effects

Wuhan had been making progress in its push to shift into higher-technology industries: In a 2019 report the Milken Institute ranked it China’s ninth best-performing city, up seven places from its previous annual report. The city was moving into areas from chip-making to biomedicine and had attracted investments from 230 Fortune Global 500 firms, according to the report.

The central and local government have invested heavily in Wuhan’s high-tech industries, especially optoelectronics and semiconductors, says Barry Naughton, a professor at the University of California at San Diego who specializes in the Chinese economy.

“For these reasons, it’s a pretty big deal,” he says. “Its economy is somewhat artificial in the sense of being propped up by government investment, but it has got a substantial high-tech sector and a substantial heavy industrial sector.”

Now the city is being closed off, as China races to halt a new virus that’s killed 25 and infected hundreds. The coronavirus, which first appeared last month in one of Wuhan’s so-called wet markets, has spread from the mainland to Hong Kong, Japan, the U.S. and other places.

Most of those who have died had other health conditions, including diabetes and heart disease, that weakened their immune systems. Symptoms include fever, cough or chest tightness, and difficulty breathing.

What Bloomberg’s Economists Say…

“With the emergence of a new virus in China rattling financial markets and disrupting Lunar New Year travels, there’s potential for a broader hit to growth—just as the economy was stabilizing.”

—Chang Shu, Chief Asia Economist

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Article Reference: American Journal of Transportation

About AJOT: American Journal of Transportation provides daily news coverage, keeps the transportation industry up to date with maritime, ports and terminals, rail, road and air-based cargo transportation issues and news

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