12 August 2020

COVID-19’ Epidemiologic and Economic Impact

Analysed bi-monthly in just a few gobbets
For time-starved, over-solicited decision-makers

In the world’s poorest countries, the toughest stage of the pandemic lies ahead. The pandemic
conflates with other risks, thus compounding economic, social, political, geopolitical, and even food
security crises. In Africa, the pandemic is about to wreck the success of the countries that were doing
well, like Ethiopia, Ghana, Rwanda, and Senegal.

The best way to think about the pandemic and understand how it roams free is to use the
metaphor of a forest fire. Forest fires often start abruptly and move quickly with the wind. It is
essential to extinguish the first flames as soon as they emerge. When this is done, the risk of flare-ups
remains high: as soon as firefighters drop their guard or become complacent, the fire can restart from
the ashes with a vengeance.

The recent and first outbreak in Vietnam, the resurgence of cases in Europe, renewed lockdowns in
the Philippines and Australia: these are all examples that give credence to the forest fire
metaphor. Only New Zealand had so far succeeded (until yesterday with the first local cases in 102
days) in suppressing the virus and restoring normalcy by cutting itself off from the rest of the world.
Auckland is now back in lockdown.

With time, the psychological impact of the pandemic is becoming ever more apparent. In all countries
where surveys and polls are conducted, people confess that COVID-19 is taking a toll on their
mental health (in the US, more than half of the adult population). Manifestations range from a
worsening of pre-existing conditions (for those with mental health issues) to the emergence of mild
forms of depression (for those previously in good mental health). The long-term effects of this
phenomenon remain unknown but are likely to be substantial, both in terms of public health and
economically.

In the autumn, economic, social and political problems will flare-up in many countries around
the world. They are likely to be most acute in countries that lack a proper social safety net. Among
rich countries, the US stands alone: the coming conflation of (1) rising unemployment, (2) the rising
number of people unable to pay their bills, and (3) food insecurity combined with precarious health will
cause a lot of misery. Some current factual evidence to corroborate this point: homelessness is
swelling, and so is demand for food pantries (up 60% compared to last year).

In several countries, progress with a possible COVID vaccine is being made at an outstanding (if not
troubling, like in Russia) speed, but building immunity could be a rather difficult and protracted
process. Different polls show that “vaccine hesitancy” is common in many countries. In the US in
particular, more than a third of the adult population states that it wouldn’t take a vaccine after FDA
approval even if it were free. In the UK, a recent poll yielded the result that only 53% of a test group of
citizens would be likely or certain to accept a vaccine.

www.monthlybarometer.com