Sunday, 24 October, 2021

The Brunt Of Economic Halt

Namrata Sharma


As the lockdown imposed due to the COVID-19 pandemic is being loosened, people are moving around and trying to make life return to “normal”. However, the new normal is seeing people moving around with masks and maintaining social distancing while working or visiting their relatives and friends. But with the cases of coronavirus not still having peaked, people are worried that the number of cases is rising steadily. But the way people are moving around is worrying as most people are not properly implementing the recommended safety measures.
I see people wearing masks but their nostrils are popping out, then as soon as people see someone familiar, the masks are pulled down and their lips and teeth are exposed. It is indeed very important for people to be masked properly and to maintain the social distance in order to prevent infection and ultimate death.

In countries like Nepal, where the majority of the people need to work every day to feed themselves and their families, the precautions that one needs to take to maintain a safe life are often ignored. Therefore, a policy that addresses the socio-cultural habits and the economic need should be taken into consideration while the COVID-19 exit policy is prepared. The majority of the Nepali workforce is outside the official social safety net. They have, therefore, already started bearing the brunt of the sudden halt of economic activities during the lockdown, leading to a slowdown in income generation activities.
According to UNDP data, Nepal’s economy is largely dependent on remittance (25 per cent of GDP), tourism (8 per cent of GDP), agriculture (26 per cent of GDP) and imports of essential items and supplies from outside. If one unpacks this, it is clear that the poor households and the often unskilled workers, including returnee migrants, have now become more vulnerable to income losses.
During the beginning of the lockdown, migrant workers who were stranded within the country and at the borders were desperately trying to get to a safe place and were struggling with food, shelter and medication. Now as the lockdown is being relaxed, there are plane loads of Nepali migrant workers returning home by spending exorbitant amount on air fares and with uncertainties looming in their mind as to what the future holds for them. On the other hand, many migrant workers who had applied for work in countries like South Korea are waiting impatiently to go there before their job offers expire.
This highlights the dilemma of the most vulnerable people in the country. It also reflects the uncertainty faced by a government which is not equipped technically and financially to cope with the situation created by the COVID-19 pandemic while being merged in the whirlpool on internal politics and foreign relation crisis with the two neighbouring countries up north and down south.
Nepal’s remittance earners are stranded in and outside Nepal and are most probably once more facing the risk of falling into the vicious cycle of poverty. Most of them had taken loan to migrate to the Gulf countries and elsewhere, now returning back with no earning and trying to catch up with life in pandemic-ridden situation could probably be an unfortunate situation pushing them into recession. Therefore, the 25 per cent of the GDP supported by remittance earners is going to be hit hard. Similarly Nepal’s tourism has been struggling since the pandemic fears started gripping the world. The largest number of tourists coming to Nepal is from India, followed by China and the USA. Just as the country was emerging out of the impact on tourism by the 2015 earthquake, the corona crisis, and now an unpleasant relation with India implicates that this industry has some dark horizons before it.
As per a report of the World Travel and Tourism Council, the contribution of the tourism sector to Nepal’s economy was 7.9 per cent in 2018. This Council represents the private tourism industry and counts more than 200 company members. 2020 being the Visit Nepal year, the government and the tourism industry were gearing up to increase their industrial activities and get a boom in their business leading to a positive impact in the country’s national economic growth. However, with most hotels, treks, and other touristic business almost closing down, 2020 is far from welcoming guests or increasing activities related to this industry. Therefore, the contribution to the GDP of Nepal from tourism is probably going to be hit hard, too.

According to the Asian Development Bank (ADB), Nepal will bear $36.78 million dollar loss to the global outbreak of coronavirus with 15,880 job cuts depending on how the virus evolves. ADB further analyses that the COVID-19 pandemic will hit almost every sector of Nepali economy, cutting off up to 0.13 per cent off the GDP. Therefore, this is the time for Nepal to be united to work towards combatting the aftermaths of this pandemic. The COVID-19 is dictating not only the change in lifestyle of the people but also demanding the need to put strategies in place to adopt a triple bottom line approach of people, planet and profit to uplift first those who have been hit the hardest in order to uplift the whole nation.

(The author is a senior journalist and rights advocate. Twitter handle: NamrataSharmaP)