The markets despise uncertainty and that truth was reflected yesterday in the huge losses on stock market boards globally.
The reactions of investors are often exaggerated but this time they are not unfounded.
The coronavirus epidemic arose just as the global economy had reached a critical juncture.
That is why, in the words of IMF chief Kristalina Georgieva, the virus is “the most pressing uncertainty”.
It is threatening to derail international economic growth which was already pressurised by trade tensions, geostrategic uncertainty, and Brexit.
Moreover, the new virus is liable to disrupt the global supply chain.
The Bank of America cited concerns over the coronavirus in revising downwards its initial projections on the growth of the global economy – from 3.2 percent to 2.8 percent.
A number of analysts believe it is too soon to quantify the prospective repercussions as much will depend on the rate of transmission and its duration.
In any event immediate international cooperation is mandatory if one hopes to avert an even worse situation.