Sectors lose and others win .. Chinese official: Corona virus will affect our economy temporarily

A Chinese official stressed that the effects of the new Corona virus outbreak on the local economy are temporary, while Beijing has strengthened its monitoring of market prices.

Lian Weiliang, vice-chairman of the National Development and Reform Commission, was quoted as saying on Monday that the new Corona virus epidemic will temporarily affect the Chinese economy.

"The good economic fundamentals for long-term growth in the country have not changed," the Chinese official told a news conference in Beijing. "We are confident and able to reduce the effects of the epidemic on the economy."

He pointed out that, although the epidemic has affected industries such as transportation and tourism, sectors such as online shopping, food and entertainment companies have registered rapid growth.

Lian Weiliang pointed out that some people compared the outbreak of the new Coronavirus with the SARS epidemic in 2003 and expected economic losses based on the SARS losses.

"China's current economic strength and ability to handle emergencies have been greatly enhanced since then, and we are fully confident and able to win the battle against the epidemic," he added.

Damages
Meanwhile, a report by the Shanghai Institutes of International Studies said Saturday that the Chinese economy cannot be underestimated amid the outbreak of the new Corona virus, even though the epidemic has directly affected the service, manufacturing, and trade sectors.

The report noted - according to Xinhua - that the potential effects of the epidemic may be different from all previous epidemics and other incidents, and said it is unwise to estimate the economic impact of the epidemic through historical experiences, because the Chinese economy is in transition from high-speed growth to high development the quality.

The report also stated that even in the short term, the epidemic did not cause a negative impact on all sectors.

On the other hand, this situation benefited sectors such as e-commerce, online games and entertainment.

In a context, a special survey showed today, Monday, that Chinese factory activities grew at the slowest pace in five months last January, with the growing risks facing the second largest economy in the world due to the spread of the coronavirus.

The Kaixin / Market index of manufacturing purchasing managers fell to 51.1 from 51.5 last December to fall below analysts' expectations, but it remained above the level of fifty, the gap between growth and contraction for the sixth month in a row, and analysts expected a reading of 51.3.

But these results are unlikely to show the initial impact of the health crisis, which worsened in late January, and may put a strain on economic growth in the coming months.

The oil sector
On the oil sector front, four informed sources said today, Monday, that Chinese Sinopec - the largest refining company in Asia - told its facilities to reduce production this month, about 600 thousand barrels per day in light of the demand for fuel affected by the spreading Corona virus.

The reduction is equivalent to about 12% of the average production of the state-owned refining company last year, according to Reuters reported today.

Concern over the spread of the Corona Virus also caused the value of Chinese shares to drop by more than $ 400 billion in today's first trading session after a long holiday marking the lunar new year, at a time when the number of deaths from the epidemic rose to 361.

Take control of the markets
Meanwhile, Gan Lin, deputy head of the State Administration of Market Regulation, said today that the main task of market regulators is to combat market violations related to fighting the new Corona virus to protect the market system and help control the epidemic outbreak.

She added during a press conference that the market regulatory authorities sent about 390 thousand law enforcement officials, and raised 1413 cases related to price violations.

She pointed out that in addition to strengthening the daily monitoring of the market, the market organizers paid the greatest attention to focusing on two main areas represented in protective products such as masks, and daily supplies such as rice, flour and vegetables, and that the general price system in the market is basically stable.