China appears to have considerable room to maneuver in terms of monetary policy. It also has an enormous domestic market and a middle class as large as the European Union. But this doesn’t mean it is turning inward.

The novel coronavirus outbreak in the lead-up to the 2020 Chinese Spring Festival has inflicted great pain on tens of thousands of patients and their families, involving countless courageous Chinese citizens, who otherwise would have spent the holiday with their families and friends, in an unprecedented anti-virus war.

The world economy has clearly caught a cold. The outbreak of COVID-19 came at a particularly vulnerable point in the global business cycle. World output expanded by just 2.9% in 2019 – the slowest pace since the 2008-09 global financial crisis and just 0.4 percentage points above the 2.5% threshold typically associated with global recession.

In addition to the devastating human toll of the coronavirus outbreak, the economic damage of a manufacturing shutdown in China is likely to be profound.

While receptive to proposals that are in line with its economic reform and opening-up agenda, the country cannot be expected to embrace rule changes that undermine ore parts of its successful economic model.

If China adopts the right policies and works successfully with the international community, there is a high chance that its economic growth will remain stable over the medium term, even with the coronavirus.

The coronavirus outbreak that began in the Chinese city of Wuhan has spread across the country and beyond its borders, leaving governments at all levels in China scrambling to limit further person-to-person transmission of the virus, now known as COVID-19.

In the long-term the outbreak will not alter the fundamentals of the Chinese economy. But actions are needed now to reduce risks, as ripple effects through supply chains can be felt around the globe.

Just five days before the Chinese New Year, the authorities in Beijing finally declared the coronavirus epidemic that originated in Wuhan to be a major public health emergency.

It is not the end of the world. The plague will soon pass, and when it does, supply chains will reconnect, production will resume and everything will return to normal.