Is Corona A Threat to Economy?
Mask For Precaution
Before the summer whack in India and most of us strive to get a sunblock or search for a mask for protection of our face from the harsh sun rays, coronavirus had already entered our doors forcefully and made us mandatory for wearing a mask.
This deadly disease had already given stringent headaches to many powerful countries and the hardest hit so far is China and Italy. Everyone is trying their best to win the battle against corona and started taking precautionary measures.
But before we further discuss more let me first give a brief about this virus and its symptoms.
According to the World Health Organization, Coronavirus is a family of viruses that can range from the common cold to middle east respiratory syndrome coronavirus, severe acute respiratory coronavirus.
Why is it dangerous?
The next question is why we are getting panic attacks while taking its name?
So here I am jotting down a few points that will help you to understand why the corona is dangerous than normal flu.
- It can spread its wings easily.
- The virus circulates through droplets in the air spread by coughing or sneezing and enters the body through the mouth, eyes or nose.
- It can remain viable on surfaces for hours to days and may be able to enter the lungs directly when inhaled.
- There are no specific treatments for coronavirus only symptoms can be treated.
- We are not immune to this disease.
Now another important question originates if the virus is that deadly then what steps should be taken to stop this monster enter our homes?
Well, the government had taken many precautionary measures to curb the pandemic establish it's roots further. From spreading awareness about the disease to isolating and treating people who got infected through this disease, the government is taking every possible action to combat against the devil.
The government is requesting people to stay at home unless there is no emergency. Many companies have instructed their employees to work from home.
As a result of these many consequences have been raised which may affect our economy in the near future.
Impact Of This Deadly Virus On Various Sectors
Each day in various countries this virus is eating up people or making them ill.
What started in the country of giant pandas called China soon spread its wings of infections across the US, France, Spain, Italy, South Korea and now in India.
More than 1,62,000 have been infected by Covid-19 as of now according to the reports. Over 4,300 people have had deaths attributed to the coronavirus, the overwhelming majority of which have been in mainland China. The World Health Organization (WHO) and the Centers for Disease Control and Prevention (CDC) have each cautioned countries worldwide to prepare for a potential pandemic after outbreaks in countries like Iran and Italy, and the continuing news is having major effects on world economies and markets.
India, so far, has officially reported 110 cases and two deaths, according to the Ministry of Health. More cases are emerging every day even as states continue to issue advisories on social distancing.
The government has put in place stringent measures to curb the spread of the virus. A mandatory quarantine of 14 days has been initiated for all international travelers arriving in the country.
Now as the Government is taking all possible steps to chop down the wings of this dangerous disease for further expansion. These results in declining many industries.
- Stock markets have declined.
- There is a huge loss to the tourism sector as most of the countries have already restricted visitors from visiting the countries as a result of this cruise ships and airlines were currently being more impacted.
- Hotels are going to bear a heavy deprivation as there is a shortage of travelers. People are avoiding being social.
- Food industries like bars and restaurants are going to be shut down for a few days which will lead to a massive loss to this industry.
- Transportation industries are suffering.
- For many companies around the world, the most important consideration from the first ten weeks of the COVID-19 outbreak has been the effect on supply chains that begin in or go through China. As a result of the factory shutdowns in China, many disruptions have been felt across the supply chain.
- The aviation sector is undergoing huge losses. Travel plans are already changing and airline bookings are being affected.
- Entertainment Industries is also under the umbrella of suffering as malls and movie halls are going to be shut for a few days.
- In consumer goods, for example, customers may put off discretionary spending because of worry about the pandemic but will eventually purchase such items later, once the fear subsides and confidence returns. These demand shocks—extended for some time in regions that are unable to contain the virus—can mean significantly lower annual growth.
The initial economic adjustment occurs through falls in equity markets, especially for the most affected industries.
Will Coronavirus Pandemic Trigger Recession?
This scenario is similar to the global slowdown.
If the number of cases continues to grow, throughout quarter two and quarter three, possibly it will lead to a reduction in the confidence of the consumers by the end of quarter four.
These scenarios may reduce the GDP growth hence leads to a recession.
What Should Be Done At This Scenario?
Companies should take proper majors to deal with the storm.
Develop a better relationship with your customers. While consumer demand is down, it has not disappeared—people have dramatically shifted toward online shopping for all types of goods, including food and product delivery. Companies should invest in online as part of their push for multiple channel distribution.
Plan and implement specific financial strategies. Regular analysis of financial statements like balance sheet, profit and loss account, cash statement will help to know the factors that may trigger a liquidity crunch in the company.
Boost the morality of your employees as they are the main assets of the company.
In order to face the storm, companies should define moves to stabilize the organization in each scenario.
© 2020 Suchismita Pradhan