While thousands die, others become millionaires at the expense of the coronavirus

The coronavirus outbreak is a phenomenon that has impacted the world. While for thousands it has become a synonymous with loss, illness and death, for others it represents a business opportunity.

The so-called Covid-19 has left more than 3,200 dead and nearly 95,000 infected in 79 countries, and predictions about the effect it will have on trade and the global economy have already begun to be made public.

China, the world’s great power and manufacturer, is the country most affected by the spread of the disease, which is why the economic burdens it will experience will have an impact on the rest of the planet.

The London-based consultancy firm Capital Economics estimates that the outbreak bill will outrun that of severe acute respiratory syndrome (SARS) in 2003.

«The spread will cost the world economy more than 280 billion dollars in the first three months of the year, ending a period of world growth of 43 quarters», warned a report released by the firm.

This figure is close to the Gross Domestic Product (GDP) of Finland or Chile, or the annual income of Microsoft or Apple. Likewise, it multiplies by seven, in nominal terms, the previous cost of SARS, which was 40,000 million, also due to the fact that China’s weight in the current economy is three times that of 2003.

Economic losses

The business world was hit first, as the combined fortunes of the world’s 500 richest people lost $ 444 billion as the coronavirus continued to spread and shake the stock markets.

According to Bloomberg, the world’s three richest people: Jeff Bezos, Amazon owner; Bill Gates, Microsoft co-founder, and Bernard Arnault, president of LVMH, recorded the highest losses, and their combined wealth fell about $ 30 billion.

One case that has filled news portals is that of Carnival Corporation President, Micky Arison, who lost more than $ 1 billion this week when the world’s largest cruise line held passengers aboard one of his ships. in Japan, where at least five of them died from the coronavirus.

Business opportunity

While several companies related to manufacturing, technology, transport and tourism have been affected by the outbreak, other sectors have seen an opportunity to increase their income.

Modern pharmaceutical chief executive, Stephane Bancel, became a billionaire after the company sent an experimental coronavirus vaccine to the US National Institute of Allergy and Infectious Diseases for human clinical testing, something that fueled the company’s share price on the stock exchange.

Another case is that of Regeneron Pharmaceuticals, which is working on the development of a treatment for the coronavirus, whose shares registered an increase in the stock market, to add 45 million dollars to the fortune of George Yancopoulos, scientific manager of the New York-based company, Bloomberg reported.

Along with the area of drugs to treat the virus, companies that manufacture supplies for its prevention have also seen a business opportunity.

Malaysian businessman Lim Wee Chaique, who owns a majority stake in the world’s largest maker of medical gloves, Top Glove, brought his net worth to $ 1 billion, shortly after fear of the Covid-19 threat went global.

On the other hand, while many companies, businesses and educational centers have had to close their doors as a preventive measure, companies that facilitate work and remote studies have gained momentum.

Eric Yuan, founder of the company Zoom Video Communications, specialized in videoconferencing, added $ 200 million to his fortune and raised his net worth to $ 5.5 billion, thanks to the rapid increase in its number of users.

In fact, the North American firm based in the state of California registers, on average, 43% more downloads this year than in 2019, with greater activity in the last month, as reported by Bloomberg.

To capture a larger market, Zoom has extended the time limits of its free service for users in China and increased the tracking of its servers to ensure the reliability of the growing demand.

«The growing epidemic has broadened my perspective on what it means to be a provider of video communications technology in times of need,» said Yuan.

Profits in China

Although the coronavirus outbreak brutally affected the Chinese economy, it also caused markets that traditionally had little demand to increase their sales, due to the quarantines to which a large part of the population has had to submit.

The main sectors where the shares increased in value are Internet education, online games and vaccines.

A striking fact is that as a result of the coronavirus outbreak and the sales boom in the pharmaceutical and entertainment sectors, there are three times more new billionaires registered in the Asian giant than in the United States.

According to the Global Hurun Report 2020 List, the Greater China region, including Hong Kong and Taiwan, generated 182 new billionaires in January, for a total of 799. While in the US, 59 new billionaires were registered in the same period.

New billionaires

Entrepreneurs such as Robin Li, founder of Baidu and owner of the popular online video platform iQiyi, or An Kang of Hualan Biological Engineering, which specializes in vaccines, saw their wealth increase as demand for their services increased.

The same scenario was experienced by Cheng Xianfeng, president of drug maker Yifan Xinfu Pharmaceutical, and Shen Ya, founder of online sales company Vipshop.

Towards the end of January, when the epidemic exploded, the technological shares of Chinese pharmaceutical companies climbed 37%, outpacing the 16% increase in world stock markets.

«China today has more billionaires than the United States and India combined», said Rupert Hoogewerf, president and chief investigator of the Hurun Report.

To reach this conclusion, in India the study counted 137 new billionaires, while in the US, 629 people reached that category. Both figures add up to 766, slightly less than the 799 they recorded in China.

«A boom in technology valuations and solid stock markets in the United States, India and China pushed billionaires to record levels», said Hoogewerf, who began publishing the list in 1999.

For the fifth year in a row, Beijing is the capital of billionaires, with 110 compared to 98 in New York. Meanwhile, Shanghai, with 83 billionaires, is now in third place after beating Hong Kong, who counted only 76.