The Covid-19 pandemic outbreak from Wuhan province of China is a new strain that has not been previously identified in humans and has impacted over 200 nations throughout the globe. Over one third of world population is under lockdown and scientists throughout the world despite all their hard efforts have very limited progress and are still struggling for appropriate medical solutions to the problem.
Present scenario
As on date, more than 280 Thousand lives have been lost and over 4 million people have been tested positive which is still rising at a rapid pace. The world leaders are having hard time to balance the tradeoff between Economic losses and disease spread which is positively correlated to the Economic activity of any Nation. Due to this very reason most of the countries specially developing ones can no longer afford to remain under lockdown for a longer period. Many of the economies have already started relaxations in their lockdown along with SOPs. (Standard Operating Procedures)
Major Development amid Outbreak- global prospective
World top most economies are at the verge of collapse. Oil prices have fallen of a cliff and stock markets around the world have been pounded. Unemployment has grown and experts suggest it is more likely to grow further due to growing losses of companies. Almost 80 countries have already requested International Monetary fund for financial help since governments priorities has remain to constrain the disease and save lives the cost of which is immeasurable in financial terms. Hence government expenditure burden has increased and revenue is declined at the same time.
Challenge for Nepal in Short run and long run
Nepal being import and remittance based economy is definitely going to face hard times by this pandemic. Both Import and remittance is expected to fall heavily due to global lockdown in short run. Government will have additional burden of health system improvement and to subsidize its priority sectors whereas the revenue part is shrinking with every additional day of lockdown. If lockdown is extended to next few months it will have worst impact on entire financial year budget. Similarly not just private Demand even supply shall be negatively affected due to limitations on normal production cycle. Due to all this Nepal’s Service sector which previously contributes over half of its GDP share can no longer remain as productive as it used to be. Especially if immediate agriculture sector and supply side priorities are not dealt with high care Nepal could also witness high inflation, famine and malnutrition in coming days.
In long run Nepal’s ambitious 22 National pride projects, 18 transformative projects and 177 high priority projects endorsed in 15th periodic plan shall remain dream for quite some time. Likewise, the target of increasing National per capita income to $1595 within next five year plan looks cloudy as well. Persistence unemployment shall follow due to limited domestic opportunity and increase participations of previously working Nepalese in foreign lands.
Way Ahead
Great challenges come with some opportunities as well. Amid this pandemic global leaders shall have new horizons of visions to create global co-operations and Social safety nets with broader reach. This is global crises and working in isolation shall not be that effective. After the pandemic is over, world shall soon face accompanying economic and social crisis that needs urgent attention. For a developing country like us, it’s working people shall utilize its present spare time in uplifting their skills and capabilities whereas government shall have policies and support readily available to accommodate its expected immigrants workforce which shall return back in near future. Agriculture and informal sector shall be encouraged with state support.
Prabhakar Kumar Jha – BM at Lumbini Bikas Bank , Birgunj
