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05.03.2020 13 OPINION Kevin-James Fenech Kevin is the founder and owner of JOB Search - jobsearch.mt and FENCI Consulting fenci.eu. He is a management consultant and business advisor by profession, focusing on strategy, human resources and recruitment. He has a passion for anything related to business and has written about the topic for over 10 years in most major newspapers or journals World economy flashes red over coronavirus T he world's leading stock markets have had their worst shock since the 2008 financial crisis and the reason for this is directly related to cor- porate profits and economic growth all over the world being negatively impacted by the Coronavirus. e Bank of England has already stat- ed that the virus will have a 'large' but temporary hit to UK growth. e G7 is talking about a 'financial hit' acknowl- edging that some major economies could tip into recession. Whereas the OECD has warned that the global economy could grow at its slowest rate since 2009. is is the Corona effect! To my mind, COVID-19 will change the world as we've known it this dec- ade both locally and internationally. I think historians will look back at 2020 and treat it as a watershed moment in geo-politics. China - the world's powerhouse for the last two decades - may never recov- er from this shock. Leading economists believe that there will be long lasting disruption to supply chains negatively affecting auto parts, electronics and pharmaceuticals for several months, even years, to come. Furthermore, the title 'undisputed producer of almost anything', which China has held for decades, may soon transfer to Mexico. e COVID-19 virus didn't cause this power shift but the outbreak of the vi- rus will accelerate the process especial- ly with the USA-Mexico-Canada free trade agreement signed in 2019. It appears that in the next three to five years leading manufacturing, automo- tive and technology players intend to move from China to Mexico especially if China-USA trade wars worsen and persist. e Corronavuris has also reminded the world how over-dependent we are on China e.g. surgical masks, medi- cines, smart phones, etc. Estimates indicate that about €12 to €19 billion worth of FDI will shift from China to Mexico in the next couple of years. As a result, Mexico will replace Chi- na over the long-term. Today, nearly half of all European or North American multinationals with a presence in China also have a foothold in Mexico and this trend is set to grow and the Coronavirus will accelerate the process. Locally, if and when there are any re- ported cases of COVID-19, the Maltese will also experience a shock to the sys- tem and our way of life will be disrupted and all this will come at an economic price. Workers and employees might have to be quarantined and work from home; many parents will be unable to go to work if schools shut down especially if they have underage children; disputes between key stakeholders about who 'pays' for the 14 days quarantine will continue; travel restrictions might come into effect; and a lot which we currently take for granted will be affected. Crises and testing moments have a habit of awakening people and the Coronavirus will do just that at least in the short term. Generally speaking, I think it took the Coronavirus to make us realise just how much 'fake news' there is in social me- dia. People don't read what they want; they read according to who they are! So 'fake news' on political issues are accepted by those whose political beliefs subscribe to a particular party and discounted by 'the other side' and vice versa. Yet the Coronavirus, I feel, has awak- ened a lot of people to the volume of 'fake news' they are exposed to and this has to be a good thing. Furthermore, if anyone has done the responsible thing and self-quaran- tined themselves at home after return- ing from Northern Italy; they've given themselves the unique opportunity to do things they normally don't have the time for such as quality time with the family; read; think about their life (self-reflection); take a break from the rat race; etc. Every cloud has a silver lining! What is certainly ironic, is that the Corona effect has brought in measures which until a few months ago we in Mal- ta and Europe, thought of unthinkable. I am referring to 'price regulation by the state e.g. surgical face masks, export bans e.g. medicines, travel bans to/from hot spots and quarantine (another word for home imprisonment). In normal circumstances these meas- ures would be an infringement of basic human rights and European free market economics but give the threat to public health, extreme measures are necessary. I think this is good overall since it will make people appreciate how lucky we are/were. Sometimes it takes a shock to the system to make people realise what really matters and how lucky they are. On a lighter note, it seems like the Co- rona effect has also made the handshake redundant. We now have the Wuhan shake: https://www.bbc.com/news/live/ world-51734185 Stay safe, be responsible, and see the silver lining in every cloud. Italy is struggling to contain coronavirus outbreak as cases spread south

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