The Great Lockdown Is Saving Lives While Increasing Poverty And Hunger Globally

[Newest Reality]

To contain COVID-19, governments have imposed the great lockdown in spite of its devastating economic impacts, intoning that we cannot put a price on human lives. It’s a pious sentiment, but wrong. As the economic costs mount, the belief that the great lockdown is putting human lives ahead of the economy is shown to be based on a false dichotomy. The trade off is not between saving lives versus saving the economy. Instead, it is between saving lives from COVID-19 versus saving lives from a massive increase in poverty and hunger globally as a result of the great lockdown, especially among the poorest and most vulnerable.

The great lockdown, being what it is, has shut down economic production from manufacturing to services, affecting businesses large and small. It has halted much of the international flows of goods as well as movement of people. As businesses closed their doors and factories shut their gates, unemployment surged. For example, some 26 million American workers filed jobless claims since the lockdown; and weekly jobless claims climbed from 0.3% of the labor force before COVID-19 to an astonishing 4.1% by the end of March. The situation is similar in the U.K. and Europe. Governments in these high-income countries are able to dramatically hike their fiscal spending to support businesses that are forced to cease operations as well as workers that are laid off. For the vast majority of the affected in low-income countries, there is no such luck. Their outlook is getting bleaker with each day that the global economy is kept in hibernation.

For example, citing research conducted by the Australian National University and Kings College, London, Oxfam is warning that global poverty is rising for the first time in 30 years. It has estimated that between 400 to 600 million people will be pushed into poverty in developing countries as a result of the great lockdown. Over one-third of these new poor will be in some of the least developed countries in Sub-Sahara Africa and South Asia. Because of rising poverty, the UN World Food Program has warned that the number of people suffering from acute hunger could easily double this year.

Global remittance flows have already started to decline as a result of the great lockdown. Today, remittances are the biggest source of capital flows to low-income countries, accounting for up to 9% of their GDP. Increasing proportions of the poorest households in these countries have come to rely on remittances to make ends meet, helping them stay one step ahead of poverty and hunger. The World Bank estimated that the current decline in global remittances is the largest on record, affecting countries as small as Tonga, Haiti and South Sudan, and as large as Egypt, Nigeria and Pakistan.

https://www.forbes.com/sites/yuwahedrickwong/2020/04/28/the-great-lockdown-is-saving-lives-while-increasing-poverty-and-hunger-globally/