dd Coronavirus challenges global companies

Coronavirus challenges global companies

Published: 14 Feb 2020   

Online Desk

The economic toll of China's viral outbreak continues to mount for corporations based in and outside of the country as factories are shuttered and consumer behavior is altered measurably.

On Thursday Alibaba, the first major Chinese company to report quarterly earnings since the emergence of the coronavirus, said the outbreak "is having significant impact on China's economy ... potentially affecting the global economy."

CEO Daniel Yong Zhang said the overall revenue growth rate at Alibaba will be negatively affected this quarter, which ends in March. Some of its businesses may have negative revenue growth.

The outbreak might spur adoption of long term consumer behavioral changes, like working remotely and ordering online, particularly in less developed parts of China, Zhang said. That's what happened in 2003 after the SARS epidemic, he said.

Alibaba is the equivalent in China of Amazon.com, only bigger. Despite supply chain problems that are affecting almost every global corporation that operates in the country, Alibaba is in a unique position to help people during the crisis and in some ways, benefit.

"So people now work remotely from home. People buy foods, buy fresh products, buy groceries, buy necessities from home," said Zhang. "I think this is a – this is a very big challenge that – the crisis is a very, very big challenge to the society, but also as I said in my remarks, give people a chance to try a new way of living and new way of work."

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