COVID-19 Pandemic and economic recovery
By: Zhihao Zhang/Irvine CA/UC Santa Barbara
The broader issue at stake here is the economic loss. Deaths are also an issue but my focus is on the economy. The COVID-19 pandemic and the economic shutdown have left a severe blow to the global economy. The international community and especially developing countries can take steps to speed up the recovery from the long-term effects of the disease. The graphical data below shows unemployment rates across the world according to World Bank.
The stakeholders involved in taking measures to save the economy include the World Bank, WHO, governments and the people. All of these stakeholders wish to see the economy return back to normal. The differences would be approaches of solving the situation. Most of them believe that social distancing, contact tracing, quarantine and vaccination is the way to go which is correct as a preventive measure.
My major audiences are government institutions, people in leadership and business people. From this people, I think that the government would have a positive view to my recommendation. They may want to see the economy change but there is also much at stake. This involves sacrificing resources and channeling it to COVID-19 measures leaving people lacking other resources. Another aspect is helping the people fight the pandemic to improve the economy. The government has the power to make change because it has the necessary resources. The government could channel much of its resources in buying vaccines and protective equipment. The people also have the possibility of making change. They can take protective measures to ensure that the disease does not spread or practice social distancing and maintain hygiene. The people or citizens have the responsibility to ensure that the disease does not spread further so that the economic impact can be minimized.
What makes me care about this issue is saving lives and improving the livelihoods of people. The livelihoods of the people are directly linked to the economy. The economies in different countries have fallen and many people have been left unemployed. Estimates by the labor market fallout in Update from Listening to Tajikistan (William Seitz and Alisher Rajabov), shows data of how many people have been laid off because of the pandemic especially in the month of April, 2020. This is a great concern, seeing people being pushed out of their houses and struggling to feed their families.
There is a reality that people will have to live with the pandemic for sometime but there are measures that I would recommend saving lives first before saving the economy. In order to limit damage caused by the pandemic to the economy begins with controlling the spread of the virus. This explains why some of the countries that are reopening opening in stages. They were able to control the spread of the disease by placing lockdown measures and enforcing it. Nations need to first track the spread of the virus to minimize total economic loss. Governments should also put in place stimulus programs to improve its GDP. The case of Coronavirus can be attributed by the steps taken in tackling the 1918 Spanish flu pandemic. The economists from the New York Fed, Federal Reserve board and MIT found that “cities that imposed stronger measures actually had more robust economic recoveries after the pandemic.” Cities which implemented measures to curb the Spanish flu enjoyed fast growth in employment and other outputs. Cities that failed to implement strict measures like social distancing were stuck in economic doldrums thereafter.
Countries that are effectively focusing to temporarily sacrifice their economies in order to minimize the spread of corona virus and save lives have been used as samples for possible economic recovery as shown in the graph below according to the Institute for New Economic Thinking.
The countries that are still facing extreme spread of Covid-19 failed to take measures in saving lives. The governments of these countries could have placed necessary measures but did not focus on implementing them. A country like the United Kingdom still records high coronavirus infection rates because the government failed in implementing its policies. The situation got worse to the point that the Labour leader Keir Starmer tweeted: “The UK has faced the deepest recession of any major economy, and now we have the highest daily death rate in the world. The British people are paying the price for the government’s serial incompetence.” (Marsh, 2021)
The figure above by the Institute for New Economic Thinking shows the severity of the pandemic in relation to strength of a nation’s economy. The worse a pandemic was allowed to spread, the more the cost of dealing with it increased. This impacts the overall economy of the country. Looking at the graph, government officials need to come to the realization that the life of the people is important in saving the economy. Countries should not in economic stimulus while allowing the virus to proliferate because this deepens the economy as the virus spreads.
A clear way of thinking of this recommendation is looking at the factors of the economy. The economy is run by number of people. When people are many, there is a ready market and this adds to the growth of the economy. Globalization has improved the economy because the market gap for products is increased. When the market is high, the economy will improve. That means that lives matter and therefore should be protected at all costs. Even if means the government spending much of its resources on the vaccines or ensuring that the people follow measures put in place, the long-term impact in the economy is beneficial.
References
“Economic and Social Impacts of COVID-19: Updates from the Listening to Tajikistan Survey.” World Bank, www.worldbank.org/en/news/factsheet/2020/07/13/economic-and-socialimpacts-of-covid-19-update-from-listening-to-tajikistan.
Marsh Sarah. (2021). UK coronavirus death toll rises with highest daily record of 1,610. The Guardian. https://www.theguardian.com/world/2021/jan/19/uk-coronavirus-death-tollrises-record
Seitz William and Alisher R, Economic and Social Impacts of COVID-19 Update from Listening toTajikistan.http://pubdocs.worldbank.org/en/718691602731244372/Listening2Tajikistan -COVID19-August2020-en.pdf
Thomas Ferguson, Paul Jorgensen, et al. “To Save the Economy, Save People First.” Institute for New Economic Thinking, https://www.ineteconomics.org/perspectives/blog/to-save-theeconomy-save-people-first.
