INTERVIEW
The Paris Stock Exchange is at its lowest level since 2016, and the Shanghai Stock Exchange at its lowest level since 2015. The coronavirus, which has killed 2,700 people and which is present in thirty countries around the world, panics the financial markets. "This reflects the panic that takes hold of investors when faced with a situation whose impacts they have difficulty understanding", explains to the microphone of Europe 1 Etienne Sebaux, partner at Kearney France, one of the world leaders in strategy consulting and management, and in charge of the study "Coronavirus and global supply: the domino effect".
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Etienne Sebaux affirms that it would be possible, if the foci of the epidemic were to multiply, that the phenomenon at the level of the financial markets would continue. Asked about a possible loss for those who save, Etienne Sebaux refuses to comment. "Very clever one who can predict impacts in all dimensions. It is above all a health crisis, but it is an economic crisis that is coming," he explains. Among the sectors concerned, the partner of the firm Kearney France points to the automobile industry, the electronics sector, and the textile sector, where, in each of these branches, there is a "domino effect".
"We have become dependent on China"
A "domino effect" linked to the fact that China, which is the country initially affected by the epidemic, "represents 30% of all that is manufactured in the world (against 1.2% in 2000, note )", explains Etienne Sebaux. "We have become dependent (...) There is therefore a chain reaction effect, insofar as companies, whatever they are, rely on a supply chain, which includes all of their suppliers , to make their products and distribute them to their customers. "
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Etienne Sebaux takes the automobile industry as an example, which is particularly affected by the economic effects of the epidemic. Even if a car is assembled in France, it only takes one component to come from China for the production process to be blocked. "Especially since this sector operates at extremely tight flow: at each stage of the chain, there is very little stock. We are always in a fairly sophisticated cog and currently, there is a grain of sand in the cog ", asserts Etienne Sebaux.
"There will be a regionalization phenomenon"
Regarding the situation on the other side of the Alps, where 11 cities are isolated and where the first European patients have died, Etienne Sebaux wants to be careful. "No one is able to predict how the situation will develop," he explains, while affirming that Italy, the first European center of the epidemic, could experience "to a lesser extent" similar economic situations. to those observed in China. "The country is very export oriented," he explains. "A colleague told me that he was receiving photos of completely empty supermarket shelves. It is a panic effect, not necessarily rational, but present."
#Italy - Supermarkets are empty and there is a start of panic in the #Milan population.
# # Coronavirus COVID19pic.twitter.com / 4965TeUJyI
To understand the partner at Kearney France, the episode of the coronavirus could also allow us to rethink the entire production scale. "There is going to be a phenomenon of regionalization, and when making decisions relating to the place of production, the risk linked to this type of crisis will be as important as the evaluation of the cost," says Etienne Sebaux.