A different kind of systemic risk
At the end of 2019 economists around the world were sure about one thing 2020 should be a year of continuity, and even better than 2019 as economic systemic risk around us started to reduce (mainly Brexit and the trade war between the US and China) GDP and employment growth were expected to be slightly above their long term average for the major economies, while investment would also continue to be strong for all asset classes
( bonds, real estate);
All these predictions were made before the outbreak of the SARS CoV 2 virus in December 2019...
The emergence of SARS CoV 2 virus (later called Covid 19 at the beginning of 2020 took the world by surprise with its virulence and delivered a shock, just as the global economy had begun to stabilise To illustrate how unexpected this outbreak was for the global economy, we can quote the results of an investors’ survey published at the end of 2019 by PWC (figure 1 The survey showed that the most concerning points were social and political issues, specifically the political landscape, government budget issues and immigration Epidemic issues were last in terms of concerns
However, despite confidence in Europe and in the United States that Covid 19 would be confined to Asia, the pandemic is now a reality and will definitely be the main issue of this year.