It is clear that there is now a humanitarian crisis of significant proportions. India is a country of 1.4 billion people and makes up a sixth of the world’s population. Here are some ways in which it is also going to affect the world economy:
Read here (The Conversation, Apr 29, 2021)
‘The widespread distribution of vaccines to combat the coronavirus pandemic and ongoing monetary easing could cause the U.S. dollar to weaken as much as 20% next year, Citibank said on Monday. “When viable, widely distributed vaccines hit the market, we believe that this will catalyze the next leg lower in the structural USD downtrend we expect,” the U.S. bank said in a research note.’
Read here (Reuters, Nov 17, 2020)
‘When the remote town of St Just, Cornwall, was locked down in March, the small community worried that its economy wouldn't survive. But one town councillor, Daisy Gibbs, rallied an army of volunteers to form 'the Daisy chain', an informal support network to ensure every household in the district had support. Inspired by her imagination and resilience, filmmaker Sky Neal followed the Daisy Chain for seven months, as local businesses adapted and the community pulled together to realise a more sustainable future. However, as a second wave of restrictions threatens, the town has to dig deep to find the resilience they need to ensure their future. Can they re-invent their local economy to survive and thrive beyond Covid?’
View here (The Guardian, Nov 2, 2020)
‘In the face of the world’s worst economic contraction since the Great Depression, a sense of urgency has now spread to most national capitals and the Washington-based Bretton Woods institutions. Unless urgently addressed, the massive economic contractions due to the COVID-19 pandemic and policy responses to contain contagion threaten to become depressions.
‘Nevertheless, many long preoccupied with developing countries’ debt burdens and excessive debt insist on using scarce fiscal resources, including donor assistance, to reduce government debt, instead of strengthening fiscal measures for adequate and appropriate relief and recovery measures.
‘Most debt restructuring measures do not address countries’ currently more urgent need to finance adequate and appropriate relief and recovery packages. In the new circumstances, the debt preoccupation, perhaps appropriate previously, has become a problematic distraction, diminishing the ‘fiscal space’ for addressing contagion and its consequences...
‘Despite her earlier reputation as a ‘debt hawk’, new World Bank Chief Economist Carmen Reinhart recognizes the gravity of the situation and recently advised countries to borrow more: “First fight the war, then figure out how to pay for it.” Hence, in these COVID-19 times, donor money would be better utilized to finance relief and recovery, rather than debt buybacks.
‘Multilateral development finance institutions should resume their traditional role of mobilizing funds at minimal cost to finance development, or currently, relief and recovery, by efficiently intermediating on behalf of developing countries. They can borrow at the best available market rates to lend to developing countries which, otherwise, would have to borrow on their own at more onerous rates.’
Read here (IPS News, Oct 17, 2020)
‘Sabah’s Covid-19 situation transcends health. A crucial part of this is recognising the difficult economic circumstances on the ground. Many of these are the product of failings in policy in the past, with the crisis bringing deep vulnerabilities to the surface. Socio-economic conditions are worsening with the lockdown. Even before 2020, Sabah’s economy had been in a tight spot. The state’s relatively high reliance on commodity-related economic activity (roughly half of the Sabah economy in 2019 was derived from commodity agriculture and mining), along with a sizable tourism sector, means that a large share of Sabah’s economy is subject to the whims of the global economy.’
Read here (Malaysiakini, Oct 25, 2020)
‘The estimated cumulative financial costs of the COVID-19 pandemic related to the lost output and health reduction are shown in the Table [in the story]. The total cost is estimated at more than $16 trillion, or approximately 90% of the annual gross domestic product of the US. For a family of 4, the estimated loss would be nearly $200 000. Approximately half of this amount is the lost income from the COVID-19–induced recession; the remainder is the economic effects of shorter and less healthy life.’
Read here (JAMA Network, Oct 12, 2020)
‘The head of the World Health Organisation (WHO) has debunked arguments that countries have to choose between public health and the economy when they look at whether to ease restrictions following a lockdown. "That is a false choice," said WHO director-general Tedros Adhanom Ghebreyesus. Instead, the WHO urges countries to focus on four essential priorities:
Read here (Straits Times, Sept 17, 2020)
‘Not so long ago, India’s future looked entirely different. It boasted a sizzling economy that was lifting millions out of poverty, building modern megacities and amassing serious geopolitical firepower. It aimed to give its people a middle-class lifestyle, update its woefully vintage military and become a regional political and economic superpower that could someday rival China, Asia’s biggest success story. But the economic devastation in Surat and across the country is imperiling many of India’s aspirations. The Indian economy has shrunk faster than any other major nation’s. As many as 200 million people could slip back into poverty, according to some estimates. Many of its normally vibrant streets are empty, with people too frightened of the outbreak to venture far.
‘Much of this damage was caused by the coronavirus lockdown imposed by India’s prime minister, Narendra Modi, which experts now say was at turns both too tight and too porous, both hurting the economy and spreading the virus. India now has the fastest growing coronavirus crisis, with more than 80,000 new infections reported each day.’
Read here (New York Times, Sept 5, 2020)
‘Soaring financial markets are blithely indifferent to lingering vulnerabilities in the US economy. But the impact of consumers' fear of COVID-19 on pandemic-sensitive services are unlikely to subside, undermining the case for the uninterrupted recovery that investors seem to expect.’
Read here (Project Syndicate, August 25, 2020)