AQEELA ASIF
CORONA virus pandemic forced many states of the world to opt isolation as safety precaution. In emergency protection measures, citizens are bound to stayindoor,therefore mainlyindustries, offices and educational institutions are closed. Quarantine status in many countries in world has slowdown the regular procedures in all spheres of life. The most important aspect of this phenomenon reveals that without consistent industrial, trade, commerce and business activities, the economy and banking systems are unable to sustain and reassure worried households and investors. UN Trade and DevelopmentAgency (UNCTAD) has mentioned that “apart from the tragic human consequences of COVID-19 Corona Virus epidemic, the economic uncertainty, it has sparked, is likely cost the global economy $1 trillion in 2020”. The pandemic of Corona Virus is the worst global issue which has jolted the economies all over the world without discrimination of rich or poor, big or small, East orWest. China – a factory of the world which was following the principle of “Mass Production” as their business tool and having the capability to flood the markets with Chinese products, is seeking new strategy to manage the crisis started with the corona out break from its city of Wuhan. Factories in China and other countries are not fully functional since December 2019 and the workers are bound to stay at home in isolation as safety measure. The first notable economic recession of this century has slowly started in 2006 – the “Financial Crunch” and in next four years it was at peak after post-World War-II in 1950. It highly affected socio-political and economic situation of the world. In history of such economic fluctuations, trade and industrial productionwasattop, othermajor sectorsincluded retail, environment and pollution, unemployment, health, financial markets, travel, insurance, gender related issues for instance the stress of unemployment affects men and women differently.Thecrisisaffectedmanycountriesindifferentways, especially the Middle East and North Africa. At the end of second decade of this century Corona Virus outbreak is another challenge for the world. The shocking decline in economic activities are crashing stock markets in many countries. All over the world, central banks policies need an emergency review to support their liabilities for fragile bubble of current situation. The economic front is open for many states and especially for the under-developed countries like Pakistan. Therefore, without proper planning and visionary economic policy formulation; a severe recession cannot be avoided. Due to closure of factories in industrial countrieslikeChina,internationalmarket and economic set-up are suffering due to an unprecedented supply shock, and local markets in different counties are indirectly confronting such economic ripple. Factory workers are not at work because they are sick or quarantined. According to the very basic principle of economics theories that imbalance in demand and supply will automatically trigger the prices and boost inflation. In such circumstances, the daily wages workers are facing the agony of high level economic stress even unable to provide food and basic life needs to their families, they are the most crushed segment of the society. PM Imran Khan also mentioned in his speech that Pakistan should follow some other countries in locking down its cities but “Pakistan’s (economic) situation is not the same as that of the United States or Europe.Thereis povertyin our country, with 25pc of the people living in extreme poverty”. He further added that “the national economy is recovering from a very difficult time and so it was decided not to lock down cities as that could result in people dying from hunger”. The worst victim of Corona Virus is Italy after China; it has strong economic ties with China. Italian government closed the shops and forced everyone to stay at home to controlthe situation. However, accordingto economic point of view it is really needed to go for the safety of fiscal measures so that to save companies and banks from bankruptcy. This way, they may recover quickly once the pandemic is over. In Italy, policy-makers are considering various forms of tax relief and public guarantees to help firms borrow if necessary. However, the most promising option is a short-time work allowance for their citizens. Such policies have already been tested in Germany, “compensates forthe underemployment oftheworkforcethroughthe same channels that are already used for unemployment insurance”. Such steps have been proved as the most appropriate steps in developed world to avoid the massive damage of the public from huge financial loss and unemployment. On the other hand, Chinese government is taking direct action against Corona crisis, lack of funds is not the issue for public, therefore, hospital intensive-care units expanded,temporary hospitals builtwithin few days, safety kits formedical staff, respirators, protective gear andmasks quickly supplied and made available to all. News reports reflecting that on March 19, 2020 no Corona Virus case was reported in China and Wuhan city was declared as corona free city. Chinese public health authorities, resources, funds and facilities are busy to disinfect factories and other public places. Hygiene is the order of the day there. China made it possible by visionary planning and conductedlarge-scaleCoronatests ofthe population, cleanliness campaign by human and robots.Their nationalmoral is high and hopefully soon they will achieve their economic targets and lead and might help stock markets. The fight against Corona is at its peak, China is lucky as it seems to have won the first battle. In the region of Hong Kong,Taiwan, Singapore and Japan have also blessed with visible successes in limiting the outbreak. All these countries already have faced epidemics of “Sars” in 2003. Germany has taken many positive steps in this regard. Although, very few Corona Virus deaths reported there so far however, the speedy rising number of infected people is alarming. In response to the crisis, ban has been imposed on public gatherings across the country, school closure andisolation.The German government hasintroduced a short-time work allowance and granted generous credit assistance, guarantees or tax deferrals for distressed companies. In the same region, Austria closed its border with Italy and Austrian schools, universities and most shops have also been closed. France, Spain, Denmark, Poland and the Czech Republic have closed their borders with Germany. A worldwide response to the crisis is not the similar as some governments convinced that are capable to slow down the spread of the virus and not ready to go for the complete shutdown. US President, Donald Trump, has declared an emergency in the country and the Congress has approved $8.3bn emergency fund to contain the epidemic, even more amount is in process for the approval of Senate. US Government has also banned foreign travellers especially from China, Iran and Europe. In South Asian region countries like Pakistan are already facing financial suffocation therefore international organizations and community should support developing countries to cope with the calamity. —The writer is Assistant Professor COMSATS University
