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Lockdown vs. the economy

Governments across the globe are in a quandary over how long they can keep their lockdown measures without causing permanent damage to the economy.

Lockdown vs. the economy

Some form of lockdown covers half of the planet—a response to the coronavirus pandemic (COVID-19) outbreak that has already killed over 46,000 people. The restrictions aimed at containing the outbreak have disrupted supply chains, virtually stopped air travel, left millions of workers jobless and sent the global economy into a vicious recession.

The Philippines was one of the early Third-World nations that implemented a widespread lockdown. The Luzon-wide lockdown closed schools, banned public transportation to limit travel, shuttered malls except drugstores and supermarkets, and established checkpoints along major and minor roads.

The rigid measures, however, have taken their toll on the economy, ordinary workers and small entrepreneurs, prompting the World Bank to significantly reduce its 2020 economic growth forecast for the Philippines to 3 percent from the actual expansion of 5.9 percent.

The quarantine, the bank noted, restricted all non-essential movement of people and closed down businesses and government agencies in Luzon―which accounts for 70 percent of national GDP―until April 14.

It warned that the Philippines economy could contract this year in case of a rapid surge in confirmed cases, resulting in a prolonged community quarantine, lengthier disruptions to government and business activities, loss of incomes and a protracted weakening of the public health system.

The government and the private sector, meanwhile, are pondering a “selective lockdown” and gradual resumption of economic activity when the enhanced community quarantine in Luzon ends on April 14, wary of a more damaging effect on the economy if the stringent measures are extended.

A modified quarantine scheme in which public transportation may be allowed to bring workers to their job sites could be one of the preferred options. The government, however, must conduct more extensive COVID-19 testing procedures to keep the virus curve in check and preserve the gains during the quarantine period.

Keeping the population healthy and safe from the virus is a tough task in the absence of a vaccine that can finally stop COVID-19. Equally daunting is keeping the economic afloat at the same time in order to preserve jobs and provide incomes to the displaced workers. These are tough choices that policy makers should carefully weigh.

Topics: COVID-19 , enhanced community quarantine , Lockdown , Economy , World Bank
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