The Economics of COVID19

Virtual Seminar Series

11 May- 12 June, 2020

 I. Introduction
Whilst the world grapples with the immediate and biological consequences of the
COVID19 pandemic, a global recession of unprecedented proportion looms. The
IMF has projected in its recently released World Economic Outlook that the globe
will contract by 3 percent, with advanced countries contracting by up to 6 percent
in 2020. The decline in global output will be more calamitous than seen in the last
financial recession, and widely expected to be the most severe since post world
war II.
Commonwealth countries have a bond that transcends some of the world’s greatest
threats in history. Members of this grouping find strength through their ability to
come together and share their challenges, lessons and experiences. The
association is particularly well known for amplifying the voice of the poor, small
and most vulnerable countries. Such is needed now not only so that countries can
be heard but also so that they can exchange ideas and solutions for tackling one of
the world’s greatest economic threats, and to prepare for a “new normal”.

II. Objectives
The virtual seminar series has been devised with a view of achieving the following
objectives:

 Opportunities for Commonwealth countries- particularly small and

vulnerable states, to air their concerns, and to share their unique challenges
and solutions for arresting the economic impact of COVID19
 Opportunity for the Commonwealth Secretariat to hear directly from
affected countries and to better understand how it may assist from across
all Directorates
 Chance to share the Commonwealth Secretariat tools being developed that
could play a role in helping countries to thrive post-COVID19.

III. Discussion Topics, Format and Schedule

The virtual series will run for a period of five weeks from 11 May to 12 June and will
focus on topical issues of burning interest given COVID19. Two different issues will
be highlighted in each seminar, which will have a panel discussion format with
seminars lasting 90 minutes each. There will be no formal presentations. The
tentative schedule and timings are provided below:

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Table 1: Tentative Schedule for Virtual Seminar Series
Seminar Theme Time Dates
1 The Impact of Covid-19 on GMT 09:00 hrs 13 May
Unemployment and Income
Inequality

2 Population Effects and the GMT 09:00 hrs 20 May

Role of Technology Post-
COVID19

3 COVID19’s Impact on GMT 13:00 hrs 27 May

Tourism, Debt, and Disaster
Risk Management
4 Lessons from Crisis GMT 11:00 hrs 3 June
Responses and Global
Coordination to Arrest
COVID19
5 Development Aid and the GMT 22:00 hrs 10 June
Gendered Impact of the
Virus
**Note: Topic details are provided in the appendix and can be accessed via the hyperlinks in the table
above.

IV. Expected Outcomes

The seminar series is expected to generate the following outcomes:
 An assessment of common and different policy approaches by
Commonwealth countries in preparing for the COVID19 induced economic
crisis
 Identification of areas for collaboration and policy coordination, which
could help to focus attention of Ministers at the 2020 October
Commonwealth Finance Ministers meeting
 Key lessons to adopt and mistakes to avoid whilst preparing to tackle the
economic crisis
 Country awareness of Commonwealth and other programmes helping to
prepare members for post-COVID19

V. Participants
Government Ministers and senior officials from Commonwealth countries and
development partners have been invited to serve on respective panels. The
general public will be provided a live stream but will not be able to directly
engage panellists. Only discussion between public participants themselves will be
allowed. This is to ensure proper management of seminars. The full schedule
including with confirmed participants will be shared by 8 May, 2020.

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VI. Logistics and Registration
This seminar series will be held via goto meeting and streamed via link provided on
LindkedIn. Countries’ officials are asked to register for the webinar via the
following registration form
https://docs.google.com/forms/d/e/1FAIpQLSe5eqLaNitDIy-
xtATKSLnb1EoKD0kcvsS35floFMlgua6EYw/viewform?usp=pp_url&entry.194545763=O
ption+1 Official participation will be limited to Commonwealth governments and
development partners registered to the event. These participants will be able to
pose questions to the panel via the seminar’s whiteboard.
Country officials not able to participate can view highlights from the sessions at a
later date on social media (Youtube, Facebook, LinkedIn and Twitter).

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 APPENDIX
Details of Discussion Topics
Seminar 1: The Impact of COVID-19 on Unemployment and Income
Inequality

The Coronavirus is proving not only to be a public health crisis but also an economic one.
Governments have devised strategies to curtail the spread but with these strategies in
place, service sector jobs that depend on customer-provider interactions are taking a huge
hit. In some Commonwealth countries, workers in hospitality, retail and transportation
services are at a higher risk of losing their jobs, and young people make up a considerable
proportion of the people working in these industries.
For instance, Africa's population as a whole is very young, with 60% of the entire continent
aged below 251. The IMF, in its Regional Economic Outlook of April 2020, estimates that
Sub Saharan Africa’s economy is projected to contract by 1.6 percent this year—the worst-
reading on record, and most likely the largest surge in Africa’s youth unemployment.
With the onset of the Covid-19 pandemic, over a million garment workers across Asia have
lost their jobs amidst declining global demand. This loss has been further compounded by
the fact that a large proportion of the Asian labour force are employed in the informal
sector, and live off daily wages. In some Asian countries, the informal labour force is as high
as 70 percent, with a large section comprising women.
Unemployment exacerbates the issue of income inequality. COVID-19 is demonstrating
socio-economic inequalities across the globe and it has exposed how vulnerable socio-
economic groups are to financial and health risks. The virus is a risk factor particularly for
those at the lower end of the income distribution spectrum. Workers in the low-income
bracket continue to work, especially frontline health workers and those operating along
critical supply chains termed as ‘essential services’. They are exempt from lockdowns but
expose themselves to risk of infection by not working from home. The state of housing
and requisite urban and spatial planning is also of concern across many Commonwealth
countries. Most cities and towns tend to have densely populated informal settlements,
thus rendering containment measures futile.
Issues for Consideration
How has Covid-19 affected employment in the Commonwealth? What are the implications
for poverty reduction efforts there?
What remedial measures can governments employ to address youth unemployment
triggered by the effects of covid-19?

Covid-19 presents an opportunity for a radical change in health and education systems. Is
this an opportune time to re-direct and re-skill the youth labour force to participate in the
4th industrial revolution (4IR)?

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There is no universal definition of youth. In Africa, youth refers to every person between the ages of 15 and 35
years.

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What remedial measures can be explored to narrow the income inequality gap exposed by
the implementation of covid-19 containment strategies?

Implementation of containment measures have proven to be a challenge in informal

settlements and the informal sector. How can these challenges be addressed moving
forward?

Seminar 2: Population Effects, Trade and the Role of Technology Post-

COVID19

Asia and Africa’s coronavirus response essentially implies that two fifths of the world’s
population is in lockdown. This is because Asia and Africa accounts for two of the most
populated regions in the world, and indeed the Commonwealth. Such large populace have
led to economies of scale and a rise in economic terms. However, with such countries now
forced to implement lockdown measures to curb the spread of the pandemic, it begs the
question - how are these countries handling the implementation and enforcement of these
measures aimed at reducing the spread of Covid-19 given large and dense populations, and
by consequence, what are their future economic prospects if their most valuable resource
–population – has to keep up with social distancing measures? How will the lockdown affect
their trade, which is largely human resource based? Have smaller states found themselves
able to better manage the pandemic by virtue of their size?
In contrast, both large and small countries alike have seen an increased reliance on
technology to navigate the changes brought on by the pandemic. Some countries in the
Commonwealth (for example Singapore, Kenya, the U.K) have developed very sophisticated
technology sectors capable of surviving the pending economic fallout. Moreover, technology
has risen in its popularity due to social distancing measures, and more broadly, it has been
expanding rapidly as a means to improve trade and the efficiency of financial transactions.
Issues for Consideration
How are regions with large and dense populations managing to implement national
lockdowns and enforcing social distancing measures?
What are the implications for trade, given the rise in global value chains?
Are small states better able to manage the pandemic given smaller populations?
Can investment in technological skills and in the technology sector help avert mass
unemployment and poverty?
How can countries collaborate with each other and the rest of the Commonwealth to
overcome issues related to this pandemic?

Seminar 3: COVID-19’s Impact on Tourism, Debt, and Disaster Risk

Management

The COVID-19 pandemic has come at a time when many countries, including in the
Caribbean, Pacific and Africa, are still trying to recover from the physical and economic
damage of several major hurricanes that ripped through these regions in the last 5 years.

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Research from the IMF suggests that these regions have a higher disaster frequency, and
costlier damage in terms of percentage of GDP. Hurricane Dorian is estimated to have
cost between $1.5 and $3 billion USD in damages in the Bahamas in September 2019.
Similarly, in 2017, Hurricane Maria cost Dominica $1.4 billion USD in damages,
representing 225% of the country’s GDP. Even still, forecasters have predicted an active
Atlantic hurricane season for 2020. Only recently, cyclone Harold – a category 5 storm -
hit Vanuatu, Fiji, Solomon Islands and Tonga. The storm decimated food supplies, and
increased food insecurity in the Western Pacific region. More importantly, it revealed
some of the complexities of battling disaster risk whilst also affected by this pandemic.
Many of the same countries exposed to heightened disaster risk also depend heavily on
tourism as an economic driver. However, the COVID-19 pandemic has brought the industry
to a grinding halt. While the decrease in oil prices will have a negative impact on oil
producers, tourism-dependent economies are forecast to be even more severely impacted.
The tourism industry employs many people, both directly in hotels, and indirectly through
related services, like taxis, restaurants, and retail sectors. Governments also collect vital
revenues, which is much needed in this time of increased government expenditure on
health and social safety nets.
Even when the virus is under control, it is easy to imagine that there will be a long-term
impact to the tourism industry, particularly for cruise ship arrivals. For both air and sea
travel, things are unlikely to return to business as usual. Countries in our regions have to
collectively think about what the new normal will be for tourism. At the same time, with
debt in the Caribbean region, for example, averaged at around 80 percent, and a majority
of our countries not eligible for debt relief, new waves of debt repudiation are quite
likely.
Issues for Consideration
How are countries preparing financially for their hurricane seasons in light of COVID-19?
What assistance is needed from the international community?
How is the tourism sector in small states being affected and what plans are there to
reinvigorate the sector post COVID19?
With the main income generator facing severe current and future strain, how do countries
plan to tackle underlying debt issues? Are we likely to witness a wave of small states’
debt restructurings?

Seminar 4: Lessons from Crisis Responses and Global Coordination to

arrest COVID-19

The response of advanced countries to mitigating the impact of the current pandemic
seems to be swift and much more deliberate than in the last global economic recession. It
would appear these countries have adopted the same fiscal approach. These countries are
spending heavily to protect jobs by keeping businesses afloat, and lowering interest rates
to unprecedented levels to stimulate or at least, maintain investment. However, it has
been recognised that this is a very different crisis. Whereas in the global financial crisis
(GFC), the crisis formed from disruption in the financial sector, this one will stem from a
total collapse of markets, due to social distancing. This point is relevant because stimulus

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measures as currently implemented, and which has benefited from the policy experience
in the past recession, target improved confidence. However, confidence from market
participants will not necessarily derive from a lower interest rate, or from fiscal packages,
it is likely only to return when there is a credible vaccine.
Prior to the pandemic, the world was dealt several blows to global coordination. Retreats
on globalisation and integration were evidenced, both in Europe and the Americas.
However, since the onset of COVID19 pandemic, the value and necessity of global
coordination has returned to the limelight. For example, countries have had to partner to
source needed personal protective equipment (PPE), which are so critical to health
workers and to sustaining the fight against COVID19. In other quarters, at the level of the
G20, they have come together to approve debt relief for the lowest income earners. Our
larger Commonwealth countries are huge players in global coordination efforts, and
conduits for the Commonwealth with respect to the G20.
Issues for Discussion
Are countries applying the right policies to address COVID19? Are the lessons from the GFC
relevant?
Should the pandemic be prolonged, how long are stimulus packages likely to last? And
what are measures can be implemented from these countries’ toolkits?
Post COVID19 are we likely to see increased global coordination? Will it inspire stronger
efforts towards integration?
How can coordination efforts amongst Commonwealth countries help to stave off the
effects of the current pandemic?

Seminar 5: Development Aid, Remittances and the Gendered Impact of

COVID-19

With most of the world simultaneously feeling the economic pinch of the COVID19
pandemic, it is natural to wonder what impact this crisis will have on development aid.
Multilateral organisations have been generous in their response to the crisis, committing
billions to supporting developing countries. However, the IMF forecasts that the global
economy will contract by 3 percent, with advanced economies experiencing an even
sharper decline of 6 percent in 2020. With this large economic downturn, development aid
is likely at risk. Additionally, while usually stable during a recession, remittances too may
come under strain in this unprecedented economic contraction. Countries in the Pacific
region have already noticed that in the aftermath of Cyclone Harold donations to help
offset the damage from disasters have largely dried up, as countries facing their own
uphill battle against Covid-19 look to spend inwardly (McGarry 2020).
Another topic of concern is women’s experience of pandemics is highly differentiated from
that of men due to their gender. The gendered impact of the virus is integral to the
discussion of how countries are dealing with Covid-19. Women are generally primary care
givers and hold large domestic responsibilities. Additionally, women will be forced to
spend more time caring for ill family members, and the elderly, teaching kids due to
school closures, and securing food due to lockdown measures (Care International
2020). Ultimately, the burden of lockdown and quarantine measures falls unevenly on the
shoulders of women.

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Stemming from this inequality of household duties is a greater economic burden for
women, who are already at a disadvantage economically, as they have less time to engage
in paid labour. Covid-19 also poses a great threat to women’s physical wellbeing. In the
Western Pacific 81% of nurses are female and only 19% are male (Care International 2020),
hence more women than men will be on the frontline of the response to COVID-19 and are
thus at increased risk and exposure to infection. There is also a great risk to women from
gender-based violence. The prevalence rates for violence against women in some of our
regions are some of the highest in the world, with 60-80 percent of women aged 15 to 49
years experiencing some form of partner violence in their lifetime.

Issues for Consideration:

How are remittances likely to be impacted by COVID19?

How will developing countries manage in the face of possible reductions to aid?

What are measures that can be taken to ensure aid reaches impacted places and
precautions are properly taken in distribution without spreading the virus?

Have countries considered the disproportionate economic effects on women in their

societies, and how is this being built into the policy response?

What can be done to mitigate against disparity in health related effects and increased
gender based violence affecting women in small states’ regions?