Coronavirus’s economic danger it will economically cripple millions

“We have been always saying that we are sitting on top of an unexploded bomb, but we don’t know what is going to trigger it,” said Emre Tiftik, director of Research for Global Policy Initiatives at the Institute of International Finance, a Washington-based financial industry trade group. “Can the coronavirus be a trigger? We don’t know. Maybe.”

(This article originally appeared on independent.co.uk)

Coronavirus’s economic danger is exponentially greater than its health risks to the public. If the virus does directly affect your life, it is most likely to be through stopping you going to work, forcing your employer to make you redundant, or bankrupting your business.

The trillions of dollars wiped from financial markets this week will be just the beginning if our governments do not step in. And if President Trump continues to stumble in his handling of the situation, it may well affect his chances of re-election. Joe Biden, in particular, has identified Covid-19 as a weakness for Trump, promising “steady, reassuring” leadership during America’s hour of need.

Worldwide, Covid-19 has killed 4,389 with 31 US deaths as of today. But it will economically cripple millions, especially since the epidemic has formed a perfect storm with stock market crashes, an oil war between Russia and Saudi Arabia, and the spilling over of an actual war in Syria into another potential migrant crisis.

Just as important as fighting the virus — if not more important — is vaccinating our economies against the incoming pandemic of panic. Human suffering can come in the form of illness and death. But it can also be experienced as not being able to pay the bills or losing your home.

Small businesses, in particular, are struggling as supply chains dry up, leaving them without products or essential materials. Factory closures in China have led to a record low in the country’s Purchasing Manager’s Index which measures manufacturing output. China is the world’s largest exporter and is responsible for a third of global manufacturing, so China’s problem is everyone’s problem — even in the midst of a trade war between the White House and Beijing. 

All this makes it even more worrying that governments continue to see this as a health crisis, not an economic one. It is time the economists took over from the doctors before the real pandemic spreads. 

It is difficult to imagine Italy not entering a recession (the world’s ninth-largest economy is now on lockdown). It is also difficult to imagine that failing to affect Europe and its largest trading partner, the United States. And it is impossible to see how any of this will not add up to a global downturn unless governments step in faster and harder than they did 12 years ago during the last financial crisis.

The stakes are higher this time, because there seems to be a coordinated effort to economically hurt many Western countries, and warn them away from the aggressive trade policies that Trump has so enthusiastically adopted.

Although China bore the brunt of the virus’s economic and human cost, many in Beijing will see a silver lining in the weakening of the US economy, and a distraction from Trump’s trade wars that appeared to be escalating with no end in sight.

President Trump has pushed through overdue payroll tax cuts and help for hourly workers — measures that will help both employers and employees survive. In the UK, Chancellor Rishi Sunak today unveiled a ‘Coronavirus Budget’. But everyone needs to think bigger if they want to properly deal with how this new factor changes the status quo.

This is about much more than coronavirus, oil prices, or even the global economy. This is about the balance of power between East and West. The epicentre of this has been, for the last 10 years, Syria. After a decade of conflict on the ground, the face-off seems to have now escalated from proxy war to economic conflict.

The emerging superpowers of Russia and China witnessed what many saw as American irrelevance in Syria. And they are now trying to cement their vision of a truly multipolar world. Rather than allowing US ally Saudi Arabia to lead the oil markets through the OPEC cartel, Russia and China want to reshape global markets — and power balances — to their advantage.

To survive these shifts, the US, UK and others will need to protect the future of their businesses, large and small, and look for opportunities to benefit from the new economic world order, not deny it. Ignoring these changes will be even more damaging than any flu pandemic.

Author - Omar Hassan (An economic development specialist and co-founder of UK: MENA Hub)

கொ ரோனா வை ரஸ் இலங்­கையின் பொ ரு­ளா­தா­ரத் ­தையும் ஆ ட்டிப் படைக்கும் நி லை ஏற்பட்டுள்­ளது. பெரும்­பா­லான மூலப்­பொருட்கள் சீனா­வி­லி­ருந்தே இலங்­கைக்கு இறக்குமதி செய்­யப்­பட்டு வரு­கின்­றன.

அந்தவகையில் இலங்­கையின் ஆடை உற்­பத்­திக்குத் தேவை­யான மூலப்­பொ­ருட்­களை சீனா­வி­லி­ருந்து இறக்­கு­மதி செய்­வதில் ஏற்­பட்­டுள்ள நெ ருக்­கடி கா ர­ண­மாக இங்­குள்ள பிர­ப­ல­மான சுமார் ஐம்­ப­துக்கும் மேற்­பட்ட ஆடை உற்­பத்தி நிலை­யங்­களை த ற்­கா ­லி­க­மாக மூ ட வேண்­டிய து ர்ப்­பாக் ­கிய நி லை ஏற்­பட்­டுள்­ளது.

அத்­துடன் அங்கு தொழில் புரிந்த ஆயி­ரத்­துக்கும் மேற்­பட்டோர் தொழில் வாய்ப்பை இ ழக்கும் நி லையும் ஏற்­பட்­டுள்­ளது.

இது குறித்து கருத்து தெரி­வித்­துள்ள ஆடை ஏற்­று­ம­தி­யா­ளர்கள் சங்­கத்தின் தலைவர் ரொஹான் ல­க் ஷானி, தற்­போது ஏற்­பட்­டுள்ள கொ ரோனா அ ச்சம் கார­ண­மாக இலங்­கையின் ஆடை உற்­பத்­திக்குத் தேவை­யான மூலப்­பொ­ருட்­களை சீனா­வி­லி­ருந்து இறக்­கு­மதி செய்­வதில் பெரும் சி க்கல் ஏற்­பட்­டுள்­ளது.

இதனால் ஐம்­ப­துக்கும் மேற்­பட்ட ஆடை உற்­பத்தி நிலை­யங்­களின் உற்­பத்தி ந ட­வ­டிக்­கைகள் பாதிக்­கப்­பட்­டுள்­ளன.

இவற்றில் சில நிலை­யங்கள் இம் மாதம் முதல் த ற்­கா­லி­க­ மாக மூ டப்­ப­ட­வுள் ­ள­துடன், ஏனை­யவை ஏப்­ரல் மாத விடு­மு­றையின் பின்னர் மூ டு­வ­தற்கு தீ ர்­மா­னிக்­க ப்­பட்­டுள்­ள­தாக தெரி­வித்தார்.

இதனால் எதிர்வரும் மே மாதம் அளவில் சுமார் ஒன்பதரைக் கோடி ரூபா வரை ந ஷ்டம் ஏற்படும் எனவும் அவர் மேலும் தெரிவித்தார்.