Many experts fear that global recession is not conjecture but reality as Coronavirus has caused short term economic disruption across the world from China to EU and the US. Whereas China watchers fear that the first quarter of its GDP could fall to five percent— real-time data shows air travel declined by 20%, restaurants by 30% and hotels by 10%. Although China has been all praised to have successfully stabilised the virus, It will take a while when workforce slowly return to offices and factories.
Singapore, Malaysia and other tourist destinations are badly affected. To offset the negative consequences of Coronavirus, the world is responding in two ways:
liquidity is injected by countries like China, and interest rates are slashed in the US, UK and EU.
🇵🇰’s requirement 4 #Corona—certificate is painful but necessary measure. By th time a passenger arrives at airport 2 be tested, they put at risk fellow passangers in any given plane: so hv 2 either avoid travel if possible or producer certificate. Any normal country does this.
— Jan Achakzai / جان اچکزئی (@Jan_Achakzai) March 18, 2020
Pakistan is no exception: the State Bank fearing an economic slowdown and following global trend has cut interest rate by 75 basis points to 12.50 pc; the Federal government has succeeded to convince the IMF that any ensuing spending with regards to Coronavirus will not be part of IMF deficit spending.
The government is still struggling to agree upon raft of economic measures: no stimulus has been offered as yet; government has also not come out with a economic strategy to support affected families and small businesses who are suffering the most; all emphasis is on “social distancing” which is right but is seen more an optic then substantive containment measure.
Read more: Why Coronavirus is a grave security challenge for Pakistan
Leading from the front, so far, the Sindh government has opted for almost a lockdown: all stores except groceries and medical stores have been asked to close for the next few weeks; shopping malls and restaurants, Intercity bus services, Seaview and public parks have also been closed down.
Balochistan’s initial reaction was timely and was appreciated but the spread of Coronavirus through Taftan-linked Zahireen to other parts of the country, have raised question mark if they (Zahireen) were properly quarantined; local authorities also nabbed several Iran-returned pilgrims near Mianghundi area of Quetta after they managed to escape from Taftan border by, a) dodging management there, b) getting fake health certificates probably in Iran, c) with suspicions that they might be from Al Zainaboon—Syrian militants of Pakistani origin—and d) that no system to screen potential militants was in place causing security implications for the country.
Political point scoring and populism is useless in these times yet KP and Punjab are under huge spotlight and many critics point to their reluctance in taking unpopular measures like shutting down schools, banning public places and congregations and checking panic buying of basic groceries including sanitisers.
The Coronavirus has severely affected small businesses and deprived the daily wagers of their livelihood. Once the virus is over the true scale of loss to the economy particularly exports, imports, FDI and tourism will surface in terms of uncountable damage.
The federal government has also not appealed for international help since it is a global pandemic and should generate global response. Friends need to be engaged to bail out Pakistan’s economy and minimise disruption to its growth cycle.
China is stabilising the Coronavirus and the number have come down to almost zero; its offering help in terms of containing the virus, yet we should ask for more assistance to offset our export losses and as the numbers of virus victims go up in Pakistan. As a short term risk, International speculation create problem for required equipments like mask and sanitisers but bigger risk is if friendly countries like the GCC and the US make no help, it will add to popular imagination and narrative that only China came to rescue but not other friends; so coordinating with friendly countries will be very helpful to prevent the risk of any negative nationalistic narrative.
According to official info, in Iran every 10 mins 1 person dies from #Covid19 and 50 people infected with virus every hour. The situation is dire. To echo @antonioguterres world leaders must unite for humanity with an urgent & coordinated global response. https://t.co/BlrkmWXaYD
— Shah Mahmood Qureshi (@SMQureshiPTI) March 20, 2020
Prime Minister Imran Khan has asked for debt relief to the IMF, World Bank and other financial institutions but the appeal needs to be converted into a sustained campaign to convince Pakistani creditors to go for relief or debt rescheduling so robust diplomacy should follow suit.
Read more: Coronavirus fear: What does Holy Qur’an say?
Anxiety and panicking are two responses people are showing. But it is a challenge you can not stop but slow it down so we have more chances to take care of: the faster we react the fastest we get out of it. Collaboration is the only word here to rescue the nation; the government with all other auxiliary intuitions needs to understand it is a health crisis today but soon will transition to an economic crisis. Time to act is now.
Jan Achakzai is a geopolitical analyst, a politician from Baluchistan, an ex-advisor to the Baluchistan Government on media and strategic communication. He remained associated with BBC World Service. He is also Chairman of the Centre for Geo-Politics & Balochistan. The views expressed in this article are the author’s own and do not necessarily reflect the editorial policy of Global Village Space.