We are already in August, and there is just four more months before the year 2021 ends. That said, for the pandemic there seems to be no end in sight. Many countries are still under lockdowns as a preventive measure against the Delta variant. The economy is still not back to normal. And the fear is that this would very well continue to the end of the year. All around the world, countries are struggling to manage the Covid while also managing economic recovery.
Take South Africa for example, according to CNBC, experts have warned that the country economy’s buoyant start to the year is likely to be ruined by a combination of renewed Covid-19 containment measures and recent civil unrest. In Australia, retail spending fall as lockdowns was reimposed across Australia’s eastern seaboard. According to The Guardian, spending fell by 1.8 per cent in a month that included Melbourne’s fourth lockdown and the first few days of Sydney’s lockdown. Spending across the nation is expected to fall further in the coming months as a result of stricter stay-at-home rules.
In the UK, even though it has lifted the lockdowns measures, yet Britain’s economy is still not out of the woods. According to The Guardian, a Bank of England policymaker said that the damage caused by the Covid-19 pandemic has been only partly repaired. “We are not out of the woods yet in terms of the virus and the impact on the economy. Yes, the economy has been growing rapidly, but on the most recent data it remains an average recession away from full employment,” he said.
According to a report by World Economic Forum, the pandemic has affected many young people, leaving them unemployed, with effects being felt worse in lower income countries. Data from the International Labour Organization shows that 255 million full-time jobs were lost around the world due to the pandemic. Youth employment has dropped 8.7 per cent globally in 2020, while for adults it was less severe, registering at 3.7 per cent. As a result of the pandemic, output in emerging and developing economies is estimated to have declined by 2.2 per cent in 2020 compared with a fall of 4.7 per cent in advanced economies.
The situation in Malaysia is not getting any better as well. As the number of Covid-19 cases continues to fluctuate between 15,000 and 17,000 per day, it seems that the lockdown order will persists until the end of the year. And that is not good news to the Malaysian economy. In an article by Nikkei Asia, the JCER survey showed a 1.2 percentage point downward revision to its growth rate, which came to 4.1 per cent. The country had the sharpest downgrade in the growth forecast among the five ASEAN nations. “We believe the services sector, and specifically the retail industry, will remain pressured in the near term as consumer activities could be [hindered] by tightened mobility restrictions and closure of nonessential stores,” said Wan Suhaimie, head of economic research at Kenanga Investment Bank.
There is no end-all solution to the Covid-19 pandemic besides speeding up inoculations. However, with the presence of new variants, vaccine is not the cure for the Covid-19, as the efficacy of the vaccines decrease with the emergence of new variants. That being said, people would soon have to learn to live with the virus instead of running away from it. “While a lockdown affects the economy, it can’t affect the people’s behaviours as they will find ways to get away from it. The pandemic should be viewed or addressed in two points – allowing everybody the rights to transact and making variables principal or delivery channel open as possible,” Malaysian Rating Corp Bhd (MARC) chief economist and head of research Firdaos Rosli said.
Photo Credit: https://asia.nikkei.com