(Yicai Global) Feb. 24 -- The outbreak of the novel coronavirus named COVID-19 is unlikely to result in major changes to global supply chains as many companies the world over depend on China, Xinhua News Agency cited a senior researcher at the Peterson Institute for International Economics as saying.

The cost of shifting a supply chain somewhere else is too high, Nicholas Lardy said, adding that it would be more cost effective to maintain production in China.

China produces a large number of auto parts that Europe, North America, Japan and South Korea depend on and cannot easily source from elsewhere, he continued, saying in this sector in particular a major supply chain shift would be out of the question.

Lardy is unsure about how much of an impact the epidemic will have on China's economy overall, saying it is still too early to determine. The nation's economic growth rate should pick up quickly if the number of new infections continues to decline and more firms get back to work, he added.

He believes that China is playing a more and more vital role in the world economy and contributing a larger proportion of growth each year. Its dependence on imported intermediate products has declined and the country is now relied upon as an exporter of such goods, which will make the COVID-19 outbreak more destructive to the global economy than the severe acute respiratory syndrome was, Lardy said.

Editor: James Boynton