The COVID-19 pandemic outbreak has resulted in unprecedented losses. There have been lockdowns to flatten the curve. There have been job losses and economic downswings around the world. So many economies have fallen into a state of recession. As such, governments around the world need to work together to minimize the global impacts of the COVID-19 pandemic.
Insights by Beth Debouvre
China was the original epicenter of this pandemic. There were lockdowns and restricted movement protocols in the Hubei province, resulting in a 40% drop in annual industrial profits in January and February. By March, factories started to reopen, but there were countless order postponements and cancellations. There were also payment delays as global buyers struggled through the uncertainty of the pandemic.
According to Beth Debouvre, China’s public health situation has seen recovery. But, when it comes to economic recovery, much of China’s economic wellbeing will depend on how the world economy recovers. The global economy is deeply interconnected, so complete recovery will depend on world recovery. Even though people are trying to manage the pandemic at home, disruptions in other parts of the world can lead to outbreaks, and even hinder recovery worldwide.
Global supply chains and more
Even international supply chains have a similar story to narrate. Before the COVID-19 pandemic, supply chains were feeling the effects of trade disputes between the U.S and China. Today, supply chains have to deal with transportation disruptions, production delays, and plunging global demand. According to the World Trade Organization (WTO), international trade might decrease by 32% in 2020. The amount of unemployment worldwide is also very high.
The need for solidarity
It is essential to understand that the world will progress in an interdependent manner. No one country can win or overcome entirely alone. Currently, the US economy is witnessing a recession, and no one wants to face nationalist political posturing. Hence, the only way to reduce the impacts of the pandemic is to practice solidarity. It is essential to secure citizens, and in order to do so, governments worldwide should collaborate and work for the benefit of all. The initial step should be to eliminate protectionist tariffs and other trade barriers. This will ensure that crucial goods, such as medical devices, medical supplies, food, and other essential items, are delivered based on demand.
Solidarity would also help in securing income, livelihood, and jobs everywhere. For this, it would be necessary to pursue practical measures to ensure that small and medium-sized enterprises (SME) stay afloat. Today, SMEs contribute a significant amount of jobs in most major economies. They offer services and goods that we consume daily. Hence, to ensure that a gradual slowdown doesn’t lead to any long-lasting damage, all these small and medium sized firms should be looked after.
As governments are trying to boost the economy from the pandemic, it is essential to work together to create a better future. That means that recovery should focus on mutual benefit, rather than competitive mindsets. Only then can the economy recover at a faster pace.