World
2020.03.17 20:01 GMT+8

Rich nations can't think only of themselves at this time

Updated 2020.03.17 20:01 GMT+8
Bertram Niles

While international media coverage of COVID-19 is now largely focused on Europe and the United States, where the disease is rampant, it is important to remember that developing nations will suffer too even if the number of cases they record is small.

Most of them will almost certainly need special assistance.

"My worry is poverty and hunger," Pakistan's Prime Minister Imran Khan said in a published interview. "The world community has to think of some sort of a debt write-off for countries like us, which are very vulnerable, at least that will help us in coping with (the coronavirus)."

Since the start of the outbreak of the novel coronavirus, which causes COVID-19, the World Health Organization has been expressing its concern about the possible impact on countries with weak health systems, especially in Africa, should the spread not be contained. 

Nations on the continent are suddenly ramping up their responses as the disease takes root in areas of the world with which they have historical links.

Spare a thought for the Caribbean, the most tourism-dependent region, where there are just a handful of cases to date but which is already wobbling from the devastating effects the coronavirus has caused to the airline and cruise industries.

Not unlike 'a hurricane'

The decline in economic activity around the world will clearly have the most severe effects among those least able to withstand financial shocks.

People traveling on a truck wear masks as they pass through a checkpoint after the start of quarantine in response to the spread of COVID-19 in Caracas, Venezuela, March 16, 2020. /Reuters

"The current economic 'sudden stop' could be likened to when a hurricane hits our Caribbean islands," regional economist Marla Dukharan tweeted on Sunday. 

"It changes everything suddenly, and for a long time. The global, coordinated policy response right now is largely absent, maybe because policymakers aren't quite sure what to do."

The G20 group was credited with a key role in restoring confidence in the wake of the 2008 financial crisis but has not been visible so far during this health and economic crisis.

At least the multilateral lending institutions claim they are listening even if a coordinated global political response is absent. 

On Monday, Kristalina Georgieva, the managing director of the International Monetary Fund, said the IMF can rapidly disburse up to 50 billion U.S. dollars in loans to emerging and developing economies. That is out of the 1 trillion dollars that the fund says it can mobilize to help its members cope with the crisis.

She said the IMF's Catastrophe Containment and Relief Trust "can help the poorest countries with immediate debt relief, which will free up vital resources for health spending, containment and mitigation." 

Countries lack resources

Earlier this month, the World Bank announced that it will fast-track 12 billion U.S. dollars in aid for developing countries wrestling with the pandemic.

South African President Cyril Ramaphosa, whose country is in recession, must now contend with the coronavirus. /South African Presidency Office

"This includes emergency financing, policy advice and technical assistance, building on the World Bank Group's existing instruments and expertise to help countries respond to the crisis," said World Bank President David Malpass

Pakistan, which is already under a tough IMF 6-billion-dollar bailout program, is, not surprisingly, feeling rather vulnerable, but Khan says he is not just thinking about his own country when it comes to COVID-19.

"It's not just Pakistan," he told the Associated Press. "I would imagine the same in India, in the subcontinent, in African countries. If it spreads, we will all have problems with our health facilities. We just don't have that capability. We just don't have the resources."

He did not mention Latin America, which experienced heightened political violence last year as economies came under stress. However, the continent of South America has recently come into the picture because of its proximity to the U.S. where the situation is deteriorating by the day.

The leaders of Argentina and Peru did the previously unthinkable on Sunday by closing borders temporarily, having decided to act quickly to curb the virus even though confirmed cases are comparatively few.

Unprecedented times

On Monday, the coronavirus count in Brazil reached 234, the most in Latin America, as the authorities moved to cancel events and suspend school classes and even encourage people to stay away from the country's famed beaches.

Sub-Saharan Africa's youthful population has been cited as a possible buffer against the virus. /VCG

In Africa, where at least 26 of the 54 countries have reported cases, stricter measures are also being put in place. South Africa, which has the highest number – 62 – in sub-Saharan Africa, concentrated minds on the continent by declaring a national disaster on Sunday and announcing travel restrictions on some foreign nationals, port and school closures and bans on large public gatherings, as well as travel from countries with cases.

South Africa's neighbors are also imposing travel bans on countries with virus cases.

Health systems on the continent, already weakened by some of the most fearful infectious diseases like HIV and Ebola, don't have the capacity to look after severely ill COVID-19 patients. Three-quarters of the countries have the tools to test, but that may be the easy part. After all, the systems of far richer nations are currently being overwhelmed before our eyes.

Many in the tropical regions of Africa, Latin America and the Caribbean still hope that hot weather will tame the beast. But bit by bit, that hope is receding.

The fact that many developing countries face severe fiscal constraints renders talk of fiscal stimulus that is driving the debate in the industrialized world largely irrelevant. They will need external help big time.

South African President Cyril Ramaphosa was speaking for many of his peers when he said, "Never before in the history of our democracy have we been confronted by such a severe situation."  

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