It is still too early to assess the economic, social and political impacts of the COVID-19 pandemic. It has claimed thousands of lives worldwide and crippled the world economy. As a commentator put it, “Coronavirus has transformed the global market into a global hospital”. This is a threat outside national borders.
Despite timely warnings, even developed countries are not ready to face the threat. No one can predict that developing countries will be the hardest hit from the disaster.
Economic impact in South Asia
Making up a quarter of the world’s total population, South Asia is most vulnerable to a pandemic. However, statistics show the opposite. Until now, according to estimates, South Asia has seen extraordinary fewer than 37,000 cases of COVID-19 and less than 9,000 deaths. This means that only 1.4% of the South Asian population has the virus.
Many people may not be directly affected in this region but because of the economy that was destroyed indirectly everyone suffered. Tax, export and remittance income fell sharply. The latest Asian Development Bank (ADB) report reflects that the economic development of Central Asian countries will rapidly decline. At present, no one can predict or predict how long the pandemic will last.
In addition, the decline in oil prices, production capacity, tourism and remittances will undoubtedly affect the economies of the countries, especially those which depend heavily on them.
Pakistan: Opportunity amid chaos
The Asian Development Bank (ADB) projects Pakistan’s economic growth to slow to 2.6 percent during the current fiscal year. Ongoing stabilization efforts, slower agricultural growth and the indirect impact of the COVID-19 outbreak on many industries have contributed to the negative outlook.
Read more: How Pakistan became safer than New York
But as they say, every cloud has a silver line, and for Pakistan, it is their empathetic Prime Minister, Imran Khan. He wants Pakistan to be economically strong and to achieve that goal he is assisted by the best civil and military officials. The Government of Pakistan recently announced a multi-billion rupee economic package to be provided help for its citizens. This package is mainly focused on low-income groups whose livelihoods are strongly influenced by Lockdown that accompanies the coronavirus pandemic.
The IMF Executive Board approved US $ 1,386 billion in emergency funding to support # PakistanEfforts to limit the human and economic impacts of # COVID-19 shocked by increasing spending on health and safety nets to protect the most vulnerable segments of the population. pic.twitter.com/oOshPaYGTV
– IMF Pakistan (@imf_pakistan) April 17, 2020
If we look at the construction sector, which is one of the largest sectors; it accounts for 2.5 percent of total GDP from Pakistan. According to the Pakistan Economic Survey 2018-19, the construction sector employs 8 percent of the country’s total workforce. It is also indirectly connected to 16 percent of the total number of people employed because more than 40 industries are allied with this sector. Some of them include electronics, steel and iron, wood, and cement.
The government has encouraged the construction sector by establishing industry status. This decision was focused on realizing an economically strong Pakistan from Khan. This is a big problem and many people related to this sector welcomed the decision.
In addition, falling oil prices on the global oil market will benefit our economy because they will reduce oil prices and inflation locally, and reduce pressure on our import bills to some extent. Oil prices are at US $ 20.75 per barrel from US $ 68 in February this year.
However, the IMF’s decision on the orders of the G-20 countries to reschedule the loans of developing countries, including Pakistan until after June 2022, is indeed a very necessary respite for the country. Not having to pay $ 12 billion this year to lenders will make Pakistan economically strong against a pandemic.
Apart from these positive things, I would say our economy has not been fully affected by COVID-19, until now. I hope we recover soon and science finds a vaccine to end this threat. I am afraid that if that doesn’t happen, this pandemic could claim millions of lives worldwide.
No matter how slow or fast we make progress, we just need to keep moving forward with expectations.
Muhammad Shiraz is a member of the FPCCI agency General. He previously served as Chair of the FPCCI Permanent Committee. Shiraz also serves on the Member Advisory Council, Ministry of the Interior, Sindh Government. He is a graduate of Brunel University London. The views expressed in this article are those of the author and do not necessarily reflect the editorial policies of Global Village Space.
to request modification Contact us at Here or [email protected]