There are few things that can not be restricted. While human and other tangible things can be restricted from entering a place, these few things are immune to restrictions. The government of every country has a security slogan that reads “protection of national integrity ”. while this is a great security strategy there are ways by which security can be affected but not physically.
One of such ways is the outbreak of epidemics. An outbreak of pandemic is like “an injury to one, an injury to all situations.” An epidemic that happens in a place has the tendency of traveling to other countries without detection at the initial stage. it is border-less, race-less and location-less It is a global affairs.
That is exactly the story of the coronavirus diseases (COVID-19) outbreak. It started in a city called Wuhan Hubei China when a 55 year old man was detected with the virus. This quickly spread to many people and countries such as Italy, South Korea, North Korea, Japan, Iran, USA, Nigeria among others. Experts say the coronavirus is an airborne disease that spreads through respiratory droplets. Which means it is contamitable through the breath of humans, sneezing and coughing that comes from humans.
Due to the injury-to-one-injury -to- all coronavirus pandemic, the current statistics as reported by worldometer as at 15th March 2020 are;
- Global cases of Coronavirus is 149,596
- Global death caused by Coronavirus is 5604
- Global recovery from Coronavirus is 73,716.
In the space of two months and few days of the outbreaks it has created negative global impacts that have shaken the roots of economic prosperity of nations.
Negative Multiplier Effects of COVID-19 to Global Economy.
National economic recession is very bad for an economy that talks more of global economic depression. We should pray it should not happen. But with the spread of this pandemic and the impact it has created, there are gloomy forecasts. Here are the negative impacts of the virus so far;
1.Decline in International Trade:
As part of the measures to contain this disease, many counties have placed bans on international travelling. Business conferences and events have been cancelled. China, which is a major manufacturing economy has also shut down production. As everybody is afraid of contracting the deadly covid-19 diseases. The virus could be contracted via contact with people, conversations, public gathering etc.
That means every country will witness a decline in its Balance of Trade (BOT) and Balance of Payment (BOP). This will affect global business activities.
2.Impact on Foreign Exchange Market:
Forex markets thrive when there is a robust international trade. This is because it is international trade that triggers the demand for currency and supply of currency. So at this time, currencies of many nations will depreciate in value because of its low demand by other countries. If there is no business transaction between nationals of a country with nationals of another country, it will lead to no demand for the country’s currency. So, international trade is the grease of the Forex market.
3.Impact on Stock Exchange Exchange:
Will you buy stock in times like this? A time when economic activities across many countries are almost being halted by the coronavirus pandemic? It is not risk averse to buy stocks at this time.
Many companies are recording decline in their market capitalization due to the problem posed by the pandemic.
According to a report by Forbes the Dow Jones has declined by about 28% between February 11 and march 12, 2020, driven by the coronavirus pandemic and turmoil in the crude oil markets. That is in a period of one month, the companies that drive the US economy have declined in market cap by 28%. That is serious!
4.Cancellation of Sport Events:
According to an article from Tekedia which stated that scientists believe that coronavirus can survive in the air for three hours, it can stay alive on copper for four hours and 24 hours on cardboard and 72 hours on plastic and steel. This has led to the cancellation of match and sport events by football associations and other sports associations. It has also been confirmed that some footballers are now diagnosed to be coronavirus positive.
What a big problem to the sport industry.! What a shock to the football clubs!
What do you think could be the worth of the cure or antidote to this globally ravaging virus?
The Economic Worth of Coronavirus Antidote
We can only know the worth of a product when we know the cost of the problem it helps to solve. We have analysed the global problems the coronavirus had created. We shall know the cost of the virus from this world bank statistics;
An internal report from the world Bank stated that in a severe pandemic, sagging tourism, transportation, retail sales, and productivity, coupled with workers absenteeism, could reduce global GDP by 4.8% according to Bloomberg.
What does this mean? It means that;
- The global 2020 GDP is predicted to be $90,519.61bn.
- A 4.8% decline of the global GDP caused by the negative multiplier effects of the virus will be $4,344.94bn.
So the global monetary worth of the cure is estimated to be $4.3 trillion. That means if the cure or the antidote is discovered we will not lose this huge money.
What then shall we do? The answer is to develop the cure.
I hereby use this medium to call on government stakeholders, Bill Gates and Melinda foundations, Global citizens, entrepreneurs ( Strive Masiyiwa, Jack Ma), Milken Institute and others to rise collectively to combat this pandemic that could cause a global economic recession. If we don’t solve this problem collectively, then we are small together and the coronavirus is stronger than us.
What is in your mind on this global trend? Comment below and join the conversation.
Subscribe to my personal blog.