Main venue of G20 Summit in Osaka, Japan, in June, 2019 Photo: Zou Zhidong/GT

Global stock markets just had a turbulent week amid heightened concern about the economic impact of the novel coronavirus pneumonia (COVID-19) outbreak. The Dow Jones industrial average and the Nasdaq both registered their deepest weekly losses since the 2008 financial crisis, with stock bloodshed also seen in Europe and Japan.

Though the weekly market rout already wiped $6 trillion off global equities last week, the current crux of concern is that whether the plunge is just a short-term correction, triggered by the worldwide spread of coronavirus, or the start of a market crash. The answer may hang on the impact of the coronavirus outbreak on the global economy, which is still hard to calculate and predict because it remains unknown how many countries will experience a severe outbreak. The World Health Organization also announced on Friday to increase the risk assessment of coronavirus to "very high".

To a certain extent, the coronavirus outbreak is an economic crisis at a global level. China paid a high price for its efforts to contain the virus spread, with the global supply chains seriously disrupted. And now the global damage is bound to increase as other major economies like Japan, South Korea and Italy are also hit hard by the virus spread.

Despite some still optimistic views that the epidemic would be contained and peak within the first quarter, thus its economic impact on the global economy would be temporary, more are now forecasting worse scenarios. For instance, Mark Zandi, chief economist at Moody's Analytics, predicted that the coronavirus outbreak may spark global recessions if it becomes a pandemic. Former Fed chair Janet Yellen also warned the outbreak could choke global growth and drag the US economy into a recession.

Consequently, policymakers in countries like Japan and the EU are signaling recently to roll out monetary easing policies to offset the impact of the coronavirus outbreak that is rattling the global economy. Yet, it should be noted that global economic downturn and financial market turmoil are not the problem of any individual country, which requires joint efforts from various countries to tackle with.

Thus, despite the controversial effects of easing policy, the top priority is to have a globally coordinated fiscal stimulus to reduce the current economic damage of the coronavirus, like the G20's response in the aftermath of the 2008 global financial crisis. Thanks to the large-scale economic stimulus by the world's 20 largest economies more than a decade ago, the financial crisis was brought under control in a timely and effective manner, with most of the economies gradually recovering from the prolonged recessions.

It is undeniable that things may be changed a lot compared with a decade ago, as fiscal and monetary stimulus options for many developed economies are limited, limiting the possibility of a globally coordinated stimulus. But coordination and cooperation among G20 members remains of paramount importance for handling a global crisis. As long as there is a chance, we hope that G20 economies join hands again in combating the coronavirus impact, because such a joint move will not only inject confidence in global markets but will also help to consolidate global trade links, thus avoiding panic contagion across the world.