By Sweeta Timilsina and Ojesh Upreti
The COVID-19 pandemic is more than just a global health crisis. The forecast on the extent of loss on world economy caused by the pandemic can now be compared with the losses incurred due to the Great Depression and World War II. Record numbers of people will likely suffer from post-traumatic stress disorder (PTSD) due to financial distress. Can we develop optimum tradeoff between public health and economy considering the importance of both sectors to run a society? Will the new normal address this trade-off, the answer is yet to explore.
According to Lexico, a website that provides a collection of English and Spanish dictionaries, the term “new normal” means a previously unfamiliar or atypical situation that has become standard, usual, or expected. The new normal is a phrase commonly used to define changes that are added to daily norms as a result of global crisis, pandemic, or any other events having a high impact on society, business, or economy.
After almost four months of nationwide lockdown, it has become vital to question how long will this lockdown help prevent the spread of coronavirus and how long will we be able to stay safe without working to our fullest capacity? As many other nations have eased restrictions, allowed some businesses to run, and opened public places, is Nepal also ready for safe reopening of economy as well as society?
If our provinces reopen, are we planning to resume our old schedule? Will we go back to work, socialize with friends, eat at a restaurant/fast food outlet, watch movies in the theatres, shop at malls, or allow our children to gather with other kids?
How will we cope with the post-COVID situation? What will the post-COVID ‘New Normal’ look like for Nepal?
According to Health Minister Bhanu Bhakta Dhakal, only 6% of COVID-19 cases in Nepal are community transmissions as of June 30. With more than 90% cases being traced to abroad returnees, proper management of quarantine and isolation centers in Tarai is the primary requirement to contain the virus. The risk of fast transmission of the virus can be minimized by wearing a mask, maintaining social distance, practicing basic hand hygiene, and proper sanitization. Incorporating a simple hygiene routine and maintaining proper social distance are the basic new normal norms that should be added to our daily routine.
The main motive of a lockdown is to discourage public gathering. Schools are closed since mid-Chaitra (March 24). Schools in Nepal mark Baisakh (May) as the start of a new academic session, but due to the nationwide lockdown and use of public schools for quarantine, reopening of education institutions will take some more time. Online classes have become a new model for education dissemination for private schools in Nepal, just like in most countries across the world.
Knowhow of technology and access to reliable internet on both the students’ and teachers’ end are necessary for effective online classes and hence this solution is only feasible for private schools. Though the government has tried to reach students through television and radio programs, this method of teaching-learning is one directional and ineffective.
Until the government provides free access to internet and electricity along with gadgets for online classes as a subsidy to students in rural areas, establishing online classes in Nepal is a long way to go. Otherwise, it will only widen educational gap between the haves and have nots.
According to a research company Technomic, 52% of consumers avoid crowds and 32% leave their homes less frequently because of coronavirus. Similarly, 30% of respondents, all millennials, said they now shop online more often than ever, according a consumer study conducted by First Insight.
The consumer is more likely, according to Adobe Analytics, to buy and stock non-perishable foods, and the demand for these products has increased by almost 69%. All of this means that most world markets must pursue online approaches seriously. The rise in demand undoubtedly brings increased business profits, but not without any obstacles as consumer behavior is shifting.
Adopting social distance means rejecting physical interaction which will therefore raise the market for eCommerce. People, with time, adjust the products they consume as well as the methods of buying and can shift to online shopping from bulk buying. This will create opportunity for ecommerce startups and can change the buying pattern in Nepal too.
Once the new coronavirus spreads within a Least Developed Country like Nepal, prospects are dire. Covid-19 is overwhelming public health systems even in many developed countries. It will almost certainly wreak havoc in countries with underdeveloped healthcare systems like ours.
Fear-based behavior modification is not proven to be sustainable, but until a vaccine for Covid-19 is discovered we can precisely view that no human being can live life to the fullest or like before.
Similarly, until the pandemic, less than 1% of the Nepali work force worked from home. With growing access to technology and accommodating work culture, working from home had been gaining traction over the years. It is also likely that many Nepalis will continue to do so following the pandemic.
It’s not easy working from home and many people want to come back to the post-pandemic office for fulltime. Nonetheless, as the crisis in public health continues, office space will possibly have to be changed to make people feel safe. It may mean eliminating open workplaces.
Meanwhile, the approach to public transport has improved with Covid-19. Though the government has called on to resume public transport by following safety protocols, it is equally important to monitor if the safety rules are being implemented. Otherwise a second wave of contagion is eminent.
Stuffing people into public vehicles beyond their seat capacity, particularly because most drivers insist on moving like they are collecting coins on the highways to achieve a new high score, is a common sight in Nepali streets. It not only compromises the vehicles’ ability to brake and maneuver, but also causes fatal accidents.
As an immediate action for the post-pandemic resumption of public transport, authorities concerned as well as vehicle operators can turn to online ticketing system with the aim to minimize contact points. Rwanda has invested heavily in public transport digitalization. Cashless ticketing has allowed public transport companies there to minimize prices. Depending on demand, public transport will run at a frequency of 30-50%. Likewise, a timecard system is available in rush hours to ease loading and unloading in Rwanda.
Similarly, remittances are important for Nepal since the country’s export and tourism foreign exchange earnings have been minimal as the primary resources for funding large import bills. Remittances for a significant number of the country’s population are also the main source of bread and butter. Many Nepalis will be back home by the end of 2020 after losing employment because of the possible downturn in economy of the key destination countries.
With International Monetary Fund’s predicted reduction in the economies of Gulf countries, many Nepalis are likely to lose employment and that will impact their income. India, Gulf countries, and Malaysia are major destinations to Nepali migrant workers.
What should worry us here in Nepal is the post-pandemic economic crisis, and its effect on political stability. Declining oil prices in the global market may provide some relief, but it is uncertain if the price fluctuation will be adjusted accordingly in Nepal. A decline in Nepali workers’ remittances and a halt in tourism for the remainder of 2020 will most certainly impact Nepalis, who live precariously even at the best of times.
What Nepal can do to normalize the economy is to try and leverage the homebound migrant workers to work towards a self-sustainability model by creating employment opportunities in agriculture, infrastructure, and market development within the country.
Timilsina is Assistant Director at Central Bank of Nepal and Upreti is a Management Analyst.