The COVID-19 Pandemic: Its Impact on Economy & Everyday Life

 

By Sitara Brooj Akbar

“The belief that the world is getting worse, that we can’t solve extreme poverty and disease, isn’t just mistaken. It is harmful.” -Bill Gates

The fight against COVID-19 has turned into a full-fledged war on all fronts. China seems to have won its first and hardest battle, with the country reporting no new domestically transmitted cases today for the first time since the pandemic began last year, marking a major milestone in the international battle to contain the virus. Similarly, South Korea, Taiwan, Singapore and Japan have also chalked up visible successes in mitigating the outbreak but unfortunately, the global infection rates continue to accelerate, with over 120 countries across multiple continents now contending with rapidly-expanding outbreaks. At the time this article has been written, the virus has infected more than two hundred thousand people and is approaching nine thousand deaths and the west just seems to be awakening from its illusions of invulnerability.

Several countries including Italy, France and the Philippines have enacted policies similar to those seen in China, placing millions under full or partial lockdowns while others such as the UAE, Australia and New Zealand are no longer allowing entry to the country for other nationalities

Panic is rising and people are attempting to gather as much food and water as they can while preparing to lock themselves up if the time comes to do so and in some cases doing so is piling on to the completely unnecessary shortage and strain on the supply chain due to hoarding of essentials.

Authorities in many nations have closed all educational institutions, offices, airports, banks and major tourist attractions and temporarily put a stop to any exams as well as all other events that require gatherings and instead thankfully in this day and age we have the technology to help us out to an extent. For those living away from loved ones, it has been helping to check up on their condition remotely and stay up to date with the latest information and guidelines. Many businesses have also suspended face-to-face activities and instead moved to work remotely which is helping to limit the spread of the disease to an extent but due to all these measures being in place, besides the devastating effects it has had in terms of human suffering, COVID-19 is also wreaking havoc upon the economy and while it could take some time yet to completely see the fallout in data, the results have already started to be felt.

The hardest-hit country besides China so far is Italy, where the death toll surpassed that of China today and with the health system overwhelmed with trying to deal with the crisis the government took drastic measures, shutting down the retail economy and quarantining the entire population. All business except pharmacies and grocery stores have remained closed for over four weeks now. All residents have been instructed to stay at home and may enter public places only for necessary shopping or commuting to work and many public and private debt obligations (e.g. housing rents and interest payments) have been deferred as the nation attempts to slow down the fiscal clock until the pandemic quiets down.

With Italy falling deeper into the crisis each day, the country’s prime minister Giuseppe Conte is urging the European Union to use “the full firepower” of its €500bn rescue fund to support its members, insisting that it was time for the European Stability Mechanism to offer emergency credit lines to countries reeling from the pandemic to help them fight the consequences.

Across the pond, the American president declared a national state of emergency and congress has approved an $8.3bn (£6.7bn) emergency programme to fund efforts to contain the epidemic while even larger sums are awaiting passage through the Senate.

The US central bank and the Bank of England have both slashed interest rates in response to mounting concerns and airlines appear as if they face a horrific year. Global stock markets overall just exhibit major swings fuelled by fear triggered by the escalating pandemic and display a volatile picture. An agreement between OPEC and Russia caused the gravest one-day crash in crude prices in approximately 30 years and FTSE, Dow Jones Industrial Average and the Nikkei have all seen sharp falls since the outbreak began, the Dow recording its biggest one day decline since 1987. It has also been predicted that European production could also suffer considerably as the continent is more dependent on trade than the US and is linked even more extensively to China through a web of supply chains. While Germany narrowly escaped recession last year, it may not be so lucky this year, especially if it fails to undertake some economic expansion. As for the UK, Brexit may finally have its long-feared economic consequences and the Organisation for Economic Cooperation and Development (OECD) has warned that the world’s economy could grow at its slowest rate since 2009.

It seems as if a severe recession can no longer be avoided, and some experts are already demanding that governments announce measures to shore up aggregate demand to tackle the unprecedented supply shock. However, in such a situation, such a demand stimulus might end up merely boosting inflation potentially leading to weak or falling GDP growth alongside rising prices, as happened during the 1970s oil crisis, when another important production input was in short supply and the same argument could be applied to liquidity support.

In this crisis what is needed are better economic measures to save businesses from bankruptcy, so that they can recover quickly once the pandemic is over. Policymakers in many countries are considering various forms of tax relief and public guarantees to help firms borrow if necessary, as well short-time work allowance and that should be implemented worldwide, hopefully helping us all so life can once more turn towards normalcy

From a more personal perspective beyond the economy and government decisions, we all must play our part in addressing the issue as well. While it is quite easy to get overwhelmed by the sheer volume of information that is being bombarded to us from all directions, take a step back and look at it matter-of-factly, considering the whole picture and fact-checking any information before sharing it instead of losing our calm with jump scares inflicting the same upon others. I am by no means saying that we should not take this as a serious risk, indeed we must follow all the guidelines that are being provided by health care professionals and the government because they are to our advantage. I have seen people being careless as they are young and the being proud of the fact that the “virus does not affect us” perhaps it won’t but you have a responsibility to everyone around you. If you as a carrier become the cause behind an elderly or immunocompromised individual getting a potentially life-threating disease is that not immoral and irresponsible? Tourists at holiday destinations are refusing to listen to local authorities despite repeated requests to adhere to the social distancing guidelines and even in such a crisis, certain people are mass gathering to hold riots. Taking all that into account it is easy to see why certain authorities are overwhelmed by the lack of seriousness around the issue and that is where the community must step up.

On the other hand, the completely apocalyptic view a certain faction has taken is equally absurd and baffling. From the doomsday-like updates spread like bushfires across social media to the conspiracy theories that run rampant, all adding hysteria to an already sky-high pile of problems. If there is one lesson that I shall take away from this crisis is that people show their true faces and priorities in times of crisis. One look at any platform and you can see the eco-fascists and eugenicists out in hoards, harping their beliefs without any qualms of the sheer absurdity of what the preach. Humanity is not a disease that the earth is taking a break from as some suggest with their infinite wisdom, rather the damage we see reversing during this time is originally a result of the over-exploitation of our planet’s resources through a flawed economic model and horrible governing. Beyond that, the virus is not a way to “weed out the week” no human life is worth any less than the other wither a person is young or old, sick or well and suggesting otherwise does not paint you as a strong icon as you might hope, rather points to your terrible upbringing and lack of character.

At the end of the day, this too shall pass. All we can do is hold for the time being then move but before it ends it is sure to take away more loved ones from people and leave lasting problems for others. Please remember to be compassionate and take a minute to think about those around you and how you might be able to help them. Even a little good deed such as buying the elderly their grocery would go a long way in perhaps making a life a little easier for those struggling more than us, it is time we look beyond ourselves to people who might not have anyone to turn to and we must do so now as you cannot do a kindness too soon, for you never know how soon it will be too late. Caring for one another is the most powerful, least costly and most underrated agent of human change.

 

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