Global Supply Chain Risk and China’s Economy: Major Public Health Crisis Insights

Abstract

China's key role in the global supply chain significantly influences its economic growth, yet it faces threats from supply chain risks, notably during major public health crises. This study examines the effects of global supply chain disruptions on China's economy, using the Global Trade Analysis Project (GTAP) model to assess impacts across different sectors. Findings reveal that China's economy can manage the broader effects of such disruptions post-pandemic, with industry-specific variations in trade balance, output, and employment. Increased negative impacts correlate with higher shock levels. The analysis shows primary and service industries benefit from domestic demand growth, whereas some manufacturing sectors suffer from reduced international demand. Industries deeply integrated into global value chains experience more severe effects from supply chain disruptions. The paper advises the Chinese government to address these risks, promoting domestic stability and enhancing global supply chain risk management strategies.