Liu Zhibiao believes that the COVID-19 has accelerated the economic downturn, and its impact is obviously greater than that of SARS, with the manufacturing industry requiring the most attention. Under the condition of industrial division of labor, the suspension of certain links in the manufacturing supply chain due to insufficient labor supply will trigger the "bullwhip effect" phenomenon, with fluctuating demand from down up being amplified, which will impact domestic and foreign value chains. The biggest impact of the epidemic is that it may disrupt ecology of China's long-term supply chain which has been established at home and abroad. However, the comparative advantage of China's manufacturing industry will still exist for a long time, and will gradually strengthen with the improvement of economic development level. Therefore, foreign investment will not alter its investment strategy towards China just because of the epidemic. In response to the epidemic, the government has issued three aspects of countermeasures to stabilize the economy, including macro, industrial and micro ones. However, the transmission of these policies must be implemented in the real economy to be truly effective. In addition, the epidemic may greatly affect China's status as a world factory and China's division of labor in the global value chain. In order to firmly promote economic globalization, China must adhere to the global value chain along the Belt and Road Initiative, strive for the early signing of the China-Japan-Republic of Korea free trade agreement, and further strengthen the construction of domestic value chains in coastal areas, the northeast economic circle, and the central and western regions.
