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The Cost of Coronavirus in Developing Countries

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Online classes – not in your comfortable home, sitting in front of a laptop or computer, but via Whatsapp groups in tents. Committed teachers are trying to keep classes running through the messaging application in the refugee camps of Idlib, Syria. Reports of despair in Zimbabwe, a country with an unemployment rate of 90%, fear of hunger among street children and slum-dwellers in Bangladesh. These are just a few signs of how the novel coronavirus is already affecting developing countries.

Source: UN.org

Where social distancing is a luxury

Experts and international organizations are warning that the pandemic will strike developing countries and emerging market economies disproportionally, exposing vulnerable populations, such as refugees or IDPs to even more afflictions. Many refugee camps are extremely overcrowded, making “social distancing”, as well as staying 1.5 meters away from the other person nearly impossible. For example, in camps where the Rohingya refugees are staying in Bangladesh, the paths are hardly even that wide. With three-quarters of refugees living in developing countries, UNHCR, the UN Refugee Agency is hoping to raise US$255 million as part of the UN’s COVID-19 Global Humanitarian Response Plan to help the most vulnerable. Social distancing is also impossible for citizens in less developed countries, like the above-mentioned Zimbabwe, where people live by earning their food on a daily basis.

biking with masks
Source: assets.irrinnews.org

A challenge to humanitarian workers

According to a 2019 UNICEF report, more than 3 billion people lack basic handwashing facilities, which is one of the most important tools against the spread of the virus. “We are facing a global health crisis unlike any in the 75-year history of the United Nations” – said the Secretary-General of the UN, while relief agencies and humanitarian operations are recalling some of their field staff, amid growing concerns of being infected with COVID-19. The executive director of the World Food Program (WFP) has also been diagnosed with the novel coronavirus. Restrictions on international travel make life harder for humanitarian workers, but the UN keeps on operating flights in places where most commercial flights have been suspended. To ensure the safety of its staff and to respond to the needs of the afflicted populations, a UN Interagency Standing Committee has put together interim guidance, to help halt the spread of the disease.

COVID-19 increases uncertainty in fragile states

War-torn Syria has confirmed its first death due to COVID-19, on 30 March. Only 64% of public hospitals are fully functional, according to the World Health Organization. If the virus spreads more widely to places like Yemen, Afghanistan, Gaza, South Sudan or the Sahel, it is devastating to even just imagine what might happen. The Regional Director of the WHO said that the number of COVID-19 infections “has almost doubled, from 32 442 cases on 26 March to 58 168 on 2 April” in the Eastern Mediterranean Region, which includes Afghanistan, and Pakistan, besides MENA countries. Most of these cases originate in Iran, with more than 50,000 people registered within its boundaries. Egypt had 985 cases by Friday night, although some researchers say true numbers could be as high as 19,000. In Yemen, 24 million people need humanitarian assistance. The civil war severely limited the country’s capacities, most doctors have not been paid for a minimum of 2 years, and testing kits are available only for 600 people. In Gaza, there are 60 ICU beds in hospitals.

Source: World Health Organization

COVID-19 numbers are rising in Burkina Faso where the most deaths were reported in sub-Saharan Africa and where displacement is continuously growing, due to insecurity in the wider Sahel area. The virus can also affect the long-delayed Malian parliamentary elections. COVID-19 arrived in Central Sahel at a time, when 5 million people are already in a food security crisis.

Economic recession in emerging markets

Not only African states or conflict areas will be dramatically affected by this pandemic. The managing-director of the IMF recently said that countries “highly dependent on commodities export” are especially exposed to a downturn. She further added:

“THE SAME WAY THAT THE VIRUS HITS VULNERABLE PEOPLE WITH MEDICAL PRECONDITIONS HARDEST, THE ECONOMIC CRISIS HITS VULNERABLE ECONOMIES THE HARDEST.”

The prognosis of Nordea Bank forecasts a 1% drop in the global GDP for 2020. According to its analysis, the slower spread of the illness in emerging markets (EM) can be contributed to less testing and less travel activity. They note, however, that EM “are still on the upward slope of the epidemic curve meaning that the speed of transmission may easily accelerate”. As stated by Nordea, EM economies have been hit so far primarily through a decrease in global trade and a drop in external demand, but this can create a shock for the internal demand. Too early containment measures can also prove to be economically fatal.

scatter plot

Echoing the words of the IMF leader, the analysis again points out, that since the epicentre of the outbreak is currently Western Europe and the United States, EM countries with strong reliance on exports to these countries (as shown below) are especially vulnerable. As reported by Nordea, since the CEE region is strongly linked to the EU, it “looks so far more vulnerable than many other EM economies amid the corona recession”.

Impact on EM in Asia

Due to the recession in Europe and America, there’ll be less demand for Asian products from the West. Emerging markets heavily dependent on the tourism sector – such as Thailand or the Philippines – will also face difficulties as a result of cancelled trips. Production shutdown in China will affect the manufacturing of intermediate products in Taiwan, South Korea and Malaysia, which are normally shipped to China.

Conclusion

The international community must not forget about the less-developed countries, even when most Western leaders are fighting this invisible enemy in their own countries. Of course, as major donor countries start to experience an economic decline, it will be hard convincing them to donate more. Also, donors should allow relief agencies to use their existing funding more flexibly, including letting them redirect earmarked money if required. As UN Secretary-General, António Guterres said:

“We must recognize that the poorest countries and most vulnerable—especially women—will be the hardest-hit” and that “global solidarity is not only a moral imperative. It is in everyone’s interests”.

Author

The author of this article is Aron Lovas, International Business Economics (BSc) student at Budapest Business School. Aron is an Associate at International Diplomatic Student Association and Editor at IDSA Foreign Affairs Newsletter.

 

 

This article was originally published at timesinternational.net.

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