It would have been impossible to write about this 18 years ago… because it’s a scenario that couldn’t have happened back then.
When the SARS epidemic struck in 2002, there was little anyone could do. To prevent its spread, everyone just stayed home.
Factories shut down. The streets were deserted.
Then, the world waited… until it was safe to go out again.
Back then, Hong Kong was still heavily dependent on manufacturing. So it took a big hit when everything stopped.
Between the first news of the outbreak and the official word that SARS was being successfully contained, Hong Kong’s stock market fell 18%. It took six seemingly endless months.
With the benefit of hindsight, that slow decline made sense. News was slow to come out of China. Social media was in its infancy.
In other words, it took time to see how SARS developed and how the world was dealing with it.
This time around, however, people are dealing with the crisis at a much faster pace. And it has a lot to do with technology that didn’t exist 18 years ago.
Let me explain…
It’s been barely two months since the new form of coronavirus, known as COVID-19, was first discovered in Wuhan – a city in China’s Hubei province. By January, several cities in Hubei were under total lockdown, effectively quarantining about 60 million Chinese citizens.
This quick response would have been nearly impossible without social media. The messaging app WeChat alone has a billion users in China – which means news travels fast. But this isn’t the only positive impact we’re seeing from technology…
With quarantine measures keeping people at home, demand for online services is booming.
Major food-delivery firm Meituan-Dianping launched “contactless delivery” last month. Customers can ask the delivery person to drop off food at their doorstep or another designated spot. As a result, Meituan’s grocery delivery orders have jumped fourfold compared with a year ago.
Now, actual robots (i.e. self-driving vehicles) are delivering goods in places like Beijing, Shanghai, and Shenzhen.
When school resumed last week after the semester break, 50 million kids in China started taking their lessons through a computer screen. (That’s almost the entire population of England.)
Meanwhile, Tencent’s WeChat office-collaboration service, WeChat Work, registered a 10-fold increase in demand since China came back from the Lunar New Year break on February 10. So despite what you hear in the news, businesses in China have not ground to a halt.
All this is succeeding thanks to something that few people outside of China are aware of…
Just four months ago, the country launched the world’s largest and fastest wireless network.
It’s called 5G. And while it’s still being tested in most countries… the technology is already available in 50 Chinese cities. Hundreds more are slated for inclusion over the next couple of years.
The difference between 5G and conventional wireless technology is night and day. It’s like driving a golf cart one minute and being behind the wheel of a Porsche 911 the next.
Yes, the COVID-19 epidemic is hurting China’s traditional economy. It’s disrupting the country’s supply chains. Many brick-and-mortar businesses are suffering. Gross domestic product (“GDP”) could take a hit in the first quarter.
But the epidemic is also setting off an unprecedented use and innovation of online services that might have otherwise taken years to happen. And China has already built the infrastructure to make it possible.
This is the important China story you’re not hearing today. And it means the online-services market could be a surprising winner in the midst of this crisis.
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Source: Daily Wealth