VIETNAM NATIONAL UNIVERSITY – HO CHI MINH CITY INTERNATIONAL UNIVERSITY SCHOOL OF BUSINESS Group Assignment - International Economics Lecturer: Cao Minh Man GROUP MEMBERS 1
NGUYỄN VŨ NGỌC THỦYBABAWE18668 TRẦN HUỲNH TRÚC NGÂNBABANS17065 ĐỖ NGUYỄN MINH ANHBABAWE17448 NGUYỄN VĂN ĐĂNG KHOABABAWE19062 NGUYỄN CÔNG DANHBABAWE16370 BÙI THỊ HOÀNG GIANGBABAWE19040 TABLE OF CONTENT 2
THE COVID-19 BACKGROUND....................................................................................................4 Coronavirus origin4 Impact on the society4 Impact on the economy5 GLOBAL ECONOMY EFFECTS OF THE COVID-19 ...........................................................7 The GDP7 The FDI8 The GDP and FDI of VietNam 9 GLOBAL TRADE EFFECTS OF THE COVID-19 ...................................................................9 Exporting and importing countries10 Trade cost in the time of global pandemic12 Trade in services in the context of COVID-19 14 E-commerce, trade and the COVID-19 pandemic 15 THE GLOBAL ECONOMY RECOVERY ...................................................................................17 Forecast the recovery time17 Vaccine Covid-1917 How to recover the economy 18 Global economy 18 International trade 19 INDIVIDUAL LESSON LEARN......................................................................................................21 THE COVID-19 BACKGROUND 3
CORONAVIRUS ORIGIN Coronavirus is in charge of the current outbreak of pneumonia that began at the beginning of December 2019 near Wuhan City, Hubei Province, China. The disease has since spread to almost all countries all over the world. COVID-19 can be severe and has caused millions of deaths around the world as well as lasting health problems in some who have survived the illness. Until now, following statistics of WHO, there are 3,720,000,000 people dying due to Covid-19 in the world, and the United States now is the most country in the number of victims and deaths in the world. IMPACT ON THE SOCIETY 1.Impact on the society From human existence, these social connections, interactions and relations have become indispensable in our life. So, if there is an absence of such connections, it definitely leads to stressful states of loneliness, anxiety, depression, mental disorders, health hazards, and many other issues which impact the life of the individual and the collective society as a whole. Early evidence indicates that the health impacts of the virus are being borne disproportionately by poor people. For example, homeless people, because they may be unable to safely shelter in place, are highly exposed to the danger of the virus. People without access to running water, food, refugees, migrants, or displaced persons also stand to suffer disproportionately both from the pandemic and its aftermath – whether due to limited movement, fewer employment opportunities, increased xenophobia. Moreover, quarantine can expose individuals to stressors both during and after the quarantine period and may result in adverse acute and long-term psychological outcomes. Effects of quarantine can include symptoms of posttraumatic stress, anxiety, and depression, and responses such as fear, anger/irritability, insomnia, fatigue, detachment and avoidance behaviors, impaired concentration, and diminished work performance. 2.Impact on the education There are a lot of student’s fears, such as not being able to graduate in time, an impossibility in taking the certificates, or the virus preventing them from finishing their exams, have reduced drastically.Due to COVID, 13% of students delayed graduation, 40% lost a job, internship, or offer, and 29% expect to earn less at 35. Online learning via studying-online apps, such as Zoom, MS Teams, Google Meet, are applied in education for students at all levels. 4
Due to the situation in Covid-19, both teachers and students are suffering from difficities, such as Internet disruption, error sound and microphone devices, misunderstanding between teachers and students,...Especially, teachers are facing the most pressures about online- teaching methods and organizing examination methods. In the educational field, availability of digital infrastructure with proper internet availability and access to gadgets must be ensured to avoid any disruption to the study process. 3.Impact on the working The Coronavirus (COVID-19) pandemic has led to millions of global employees to work from home – an unprecedented and ongoing phenomenon “facilitated by the rise of connectivity and communication technologies”. Virtual teams were already growing in number and importance pre-COVID-19, as noted in the paper. Now, many workers participate in a variety of remote teams, via synchronous and asynchronous digital communication. Since virtual teams are here to stay for many workers even post-pandemic, it’s important to recognize the challenges and adopt best practices. Moreover, the people working from home require awareness and knowledge of hackers. In fact, the fastest growing type of cybercrime, a lot of big companies are now playing on fears about leaking private information. Because home-working becomes the new normal, criminals are taking advantage of vulnerable people and workplace disruption to steal information and get money. Furthermore, because many small businesses are financially fragile, mass layoffs and closures had already occurred. So, the majority of businesses planned to seek funding through the Coronavirus Aid, Relief, and Economic Security (CARES) Act. However, many anticipated problems with accessing the program, such as bureaucratic hassles and difficulties establishing eligibility. IMPACT ON THE ECONOMY The outbreak of pandemic COVID-19 across the world has completely disrupted the political, social, economic, religious, and financial structures of the world. More than 80 countries have closed their borders from transitioning countries, ordered businesses to close, instructed their populations to self-quarantine, and closed schools to an estimated 1.5 billion children. The world’s top ten economies such as the United States, China, Japan, Germany, United Kingdom, France, India, Italy, Brazil, and Canada stand on the verge of complete collapse. In addition, stock markets around the world have been pounded, and tax revenue sources have fallen off a cliff. The epidemic due to infection is having a noticeable impact on global economic development. It is estimated that by now the virus could exceed global economic growth by more than 2.0% per month if the current situation persists. Global trade may also fall from 13 to 32% depending on the depth and extent of the global economic slowdown. The three important Economic impact of COVID-19 could affect the global economy through: 5
1. Direct impact on production Production has already been substantially affected by the shutdown in global areas. Some other countries are also beginning to feel a direct impact as their authorities put in place similar measures. The slowdown or lockdown in many countries has effects on exporters to other countries. According to the World Bank, even without new outbreaks of the disease, these areas will likely experience slow growth in the first half of 2020. Over the last two decades the People’s Republic of China has become the world’s largest exporter and an integral part of global production networks. China has established itself as a key provider of inputs and components for many products, such as automobiles, cellphones, medical equipment, and more. As a direct consequence of the spread of coronavirus, China has seen a dramatic reduction in its manufacturing Purchasing Managers Index (PMI) to 37.5, its lowest reading since 2004. This drop implies a 2% reduction in output on an annual basis, which has ripple effects through the global economy and thus far has caused an estimated drop of about $50 billion across countries. The most affected sectors include precision instruments, machinery, automotive and communication equipment. 2. Supply chain and market disruption: Many manufacturing firms rely on imported intermediate inputs from China and other countries affected by the disease. Many companies also rely on sales in China to meet financial goals. The slowdown in economic activity—and transportation restrictions—in affected countries will likely have an impact on the production and profitability of specific global companies, particularly in manufacturing and in raw materials used in manufacturing. 3. Financial impact on firms and financial markets: Temporary disruptions of inputs and/or production might stress some firms, particularly those with inadequate liquidity. Traders in financial markets may or may not correctly anticipate or understand which firms might be vulnerable. The resulting rise in risk might reveal that one or more key financial market players have taken investment positions that are unprofitable under current conditions, further weakening trust in financial instruments and markets. A possible event would be a significant financial market disruption as participants become concerned about counterparty risk. 6
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