Socio-environmental Impact of Coronavirus on World Economics

Socio-environmental Impact of Coronavirus on World Economics

Impact of Coronavirus on the World Economy

In the month of June 2020, over 8 million confirmed cases of COVID-19 have been reported. COVID-19 is a disease caused by a strain of coronavirus known as SARS-CoV-2 (virus). This sub-microscopic entity contains lipoprotein and genetic material known as single stranded Ribose Nucleic Acid (RNA). It is identified as an infectious virus to humans and with a potentially life-threatening outcome. One of the most tragic episodes of human life loss in the modern history of mankind has been due to this infectious agent.

Background

At first, it was identified in November-December 2019 in Wuhan, China. Afterwards, the pandemic spread across the world affecting 188 countries & territories. According to an estimate, the current world human population is over 7.8 billion out of which over 8.5 million people have been reported with COVID-19. Presently, 456,000 deaths have been reported. Although, a little over 450,000 people have recovered from COVID-19, there are still currently no cures, specific treatments, or vaccines. However, there are many ongoing clinical trials for evaluating potential treatment options within governmental and non-governmental agencies.

The World Health Organization (WHO) declared the COVID-19 outbreak a global pandemic on March 11, 2020. Several countries like China, Italy, Spain, and Australia took strict measures including nationwide lockdowns, quarantines and/or cordons.   Subsequently, almost all countries, including the United States of America, India, most of the European nations, Mexico, Brazil, other South American countries, African, Asian and Oceanian countries have executed control measures for minimizing the impact by either implementing partial or complete lockdowns. Because of coronavirus (SARS-CoV-2), the world economy is in recession, unemployment levels have risen, and sales have plummeted down to zero in many industries.

Economic Impacts

Due to the initiative taken by the government or by people themselves during this period, it is noticeable that most of the economic activities have been adversely impacted. This is very apparent in those sectors where virtual production is not an option, such as manufacturing, food processing, oil & gas refineries, and other industries, etc. The world trade and movements have been rapidly diverted or disrupted because of interrupted activities. These disruptions may have extensive and far reaching consequences on the world economy. According to a forecast by the World Bank, the global economy will shrink by 5.2% this year. Severe disturbances in domestic demand & supplies, trade, and finance activity among advanced economies is anticipated to shrink by 7% whereas emerging markets and developing economies are expected to shrink by 2.5%. According to an estimate, the United States economy will contract 6.1% this year, this reflects the worries associated with pandemic-control measures. Overall, the per capita income of the world is expected to decline by 3.6% to force millions of people into extreme poverty this year.

Socio-environmental Best Practices for Recovery

Management of COVID-19 Disaster

The disaster management of COVID-19 is one of the most important and integral steps towards a successful economic recovery effort. Response and recovery is directly dependent on the proportion of the population suffering from this pandemic. Accurate information on counts, tracking, and record keeping helps in formulating proper strategies for socio-economic recovery. Postponement or cancelation of social activities such as cultural, entertainment, religious and festive events adversely affect the economic growth at local, state, country, and global levels.

Social Security Assurance

Social insecurity due to the long stretch of this pandemic is badly impacting the economy both locally as well as globally. At this time, due to decreased activities in work or production, people are left with very limited choices and may not be in a position to spend to keep the economy afloat. Both governmental and non-governmental agencies have extended a helping hand to people to provide financial help/aid. These actions in terms of a stimulus package, tax cuts, and subsidies on essential commodities build public confidence towards economic recovery.

Minimizing Pandemic Scares

It is understandable that potential impacts on the economy are) huge, especially due to looming costs resulting from medical conditions, sickness, and deaths caused by COVID-19. It appears that some of the conditions are going to fade out over short periods of time, but several others will be persisting over extended periods. Even though there is negativity, fear, sadness, and antipathy about this worldwide pandemic, carefully drafted exit strategies can build confidence and trust among people for a successful recovery without any scares and fears. Fake news without scientific evidence through news media outlets or social networking sites create panic and distrust to solidify the pandemic scare. Overall, minimizing the pandemic scares will contribute positively towards flattening the curve and will also provide a secure path to socio-economic recovery. It does not mean that the problem should be overlooked and go without action.

Restoration of Demand and Supply Chain

The slowing manufacture of essential goods and services has disrupted the supply chain. This unexpected disruption is responsible for losses in national and international business and trade. Previously, geopolitical events, climate-related disasters and public health crises have) been noticed to influence demand and supply chain disruptions. To reduce the economic impact, smart planning coupled with modern technologies would facilitate optimization to minimize costs, reduce inventories, and drive up assets to handle supply chain restoration during the crisis. Technological advantages such as internet, artificial intelligence, robotics, 5G, and digital supply networks (DSNs), etc. are helpful in improving visibility across the end-to-end supply chain in real time that may preserve the overall ability to respond to any such crisis in a successful manner.

Enhancement of Cash Flow

Cash flow and liquidity are two critical components of economics which determines the health of businesses. The hostile environment caused by the coronavirus pandemic has severely impacted businesses. Volatility in the financial market, poor credit availability, inadequate liquidity, and other factors that are responsible for such conditions are identified as potential driving forces behind the slowing down of cash flow. It is crucial to manage the cash flow and liquidity for financial recovery of losses. For cash preservation, minimize your capital expenditures and defer non-essential spending for as long as possible. Determine short term liquidity needs to look for the opportunity for building a cash fund that safeguards your business. Explore the possibility of investors, both in private and public sectors, that can assist with financing working capital with more practical and better terms. Actively look for grants or stimulus package fund assistance injected by the government to preserve and support businesses. Significant slow-down in revenue growth may also be addressed by evaluating and optimizing customers’ supply and demand chains.

Health and Hygiene

In response to the pandemic, enhanced efforts to promote health and hygiene will improve the recovery thus helping in stabilizing the economy. Several residential and commercial properties are abandoned in absence of routine activities. Non-utilization and lack of maintenance of built structures creates problems linked to physical, environmental, and biological damage. These damages include but are not limited to structural damage, microbial growth (virus, bacteria, mold, mites, etc.), moisture intrusion, irregularity in temperature, perception of odors, allergens, pest issues, and others. Enhanced productivity is only possible with good health and working in a safe and hygienic work environment. Some simple and basic environmental tests validate the hygienic status of an occupiable space. A coronavirus environmental test is a valuable test to ascertain presence or absence of this infectious agent to avoid any concern of the occupants. In case of a positive coronavirus scenario remedial or corrective action must be initiated to resolve any such issue. A proper management of health and hygiene conditions ultimately enhances productivity that leads towards the path of economic recovery.

Economic recovery greatly depends on the awareness, truthfulness, cooperation, and precautionary measures besides clinical management of COVID-19.

For more information on the environmental surveillance or remediation of SARS-CoV-2 in buildings please contact EDLab or call 1-800-422-7873.

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