Pandemic: COVID-19

1. What is COVID-19?

COVID-19 (coronavirus disease 2019) is a disease caused by the SARS-CoV-2 virus, which
was discovered in Wuhan, China, in December 2019. It is highly contagious and has spread
rapidly throughout the world. COVID-19 is most commonly associated with respiratory
symptoms that resemble a cold, the flu, or pneumonia. COVID-19 has the potential to infect
more than just your lungs and respiratory system. The disease may also affect other parts of your
body.

In depth, SARS-CoV-2 belongs to the coronavirus family, which includes viruses that cause
everything from head or chest colds to more serious (but less common) diseases like severe acute
respiratory syndrome (SARS) and Middle East respiratory syndrome (MERS). Coronaviruses,
like many other respiratory viruses, spread quickly via droplets that are expelled from your
mouth or nose when you breathe, cough, sneeze, or speak.

Coronaviruses get their name from the spike proteins that protrude from them, giving them a
crown-like appearance. These spike proteins are crucial to the virus's biology. The spike protein
is the part of the virus that attaches to a human cell and allows it to infect it, allowing it to
replicate and spread to other cells. Antibodies that target these spike proteins can protect you
from SARS-CoV-2. Because of the importance of this part of the virus, scientists who sequence
the virus for research use a process called genomic surveillance to keep track of mutations that
cause changes to the spike protein.

The SARS-CoV-2 virus begins to form genetic lineages as genetic changes to the virus occur
over time. The SARS-CoV-2 virus can be traced out in the same way that a family tree can.
Various branches of that tree have different characteristics that affect how quickly the virus
spreads, the severity of the illness it causes, and the effectiveness of antiviral treatments. Viruses
with these changes are referred to as "variants" by scientists. They're still SARS-CoV-2, but
they're likely to behave differently.
2. Economic effects of Covid-19

COVID-19 was declared a pandemic by the World Health Organization (WHO) on 11 March
2020, citing over 3 million cases and 207,973 deaths across 213 countries and territories. Not
only has the infection become a public health emergency, but it has also had a global economic
impact. Reduced productivity, deaths, business closures, trade disruptions, and the destruction of
the tourism industry have all had significant economic consequences around the world. COVID-
19 may serve as a "wake-up" call to world leaders to increase collaboration on epidemic
preparedness and provide the funding required for global collective action. Despite the
availability of sufficient data on the expected economic and health costs of infectious disease
outbreaks, the world has failed to invest adequately in preventive and preparedness measures to
mitigate the risk of large epidemics.

As a result of globalization, urbanization, and environmental change, infectious disease

outbreaks and epidemics have become global threats, requiring a coordinated response. In the
case of COVID-19, such collaboration is critical, especially for the development and production
of a vaccine. The Coalition for Epidemic Preparedness Innovations (CEPI) has been monitoring
global COVID-19 vaccine development activity and advocating for strong international
cooperation to ensure that, once developed, the vaccine is manufactured in sufficient quantities
and that all nations, regardless of ability to pay, have equitable access to the vaccine. However,
the global response and prevention measures for COVID-19 were implemented too late, after the
virus had already spread to other regions through international travel.

In addition to the significant burden on healthcare systems, COVID-19 has had significant
economic consequences for the countries affected. Due to premature deaths, workplace
absenteeism, and productivity losses, the COVID-19 pandemic has had a direct impact on
income, as well as a negative supply shock, with manufacturing activity slowing due to global
supply chain disruptions and factory closures. China's production index, for example, fell by
more than 54% in February compared to the previous month. Consumer behaviour changed as a
result of the epidemic's impact on productive economic activities, as well as the fear and panic,
decreased income, and household finances that accompanied it. Reduced travel has had a
significant impact on the tourism, hospitality, and transportation industries. As outbreaks of
novel infections are unlikely to go away anytime soon, proactive international action is needed
not only to save lives but also to protect economic prosperity.
3. Effects of COVID-19 on Managing Personal Financial and Budgeting

The Coronavirus has divided up the country, with an increase in the number of businesses
forced to close due to a lack of cash flow caused by an increase in the unemployment rate.
Consumers have been forced to change their spending habits as well as how they deal with debt
and credit as a result of this situation. Because the economic impact of COVID-19 has increased
the risk of financial instability, temporary relief measures to assist households and businesses
have been implemented. The Malaysian government has announced a series of economic
stimulus packages aimed at mitigating the pandemic's economic effects, including a monthly
financial aid of RM600 from the Social Security Organization (SOCSO) to employees on forced
unpaid leave, as well as the ability to withdraw RM500 from the Employees Provident Fund
(EPF). In addition, Bank Negara Malaysia (BNM) has ordered all banks to grant an automatic
six-month moratorium (deferment) of loan/financing repayments from April to September 2020.

While some aspects of one's financial well-being are beyond one's control, financial
knowledge can assist people in better managing their finances during difficult times. as well as
prosperous times. Everyone should be well-informed about their financial situation. Individuals
can benefit from having a good understanding of their financial situation when it comes to money
management (income and debt). Individuals can set financial goals by consulting with a financial
adviser. In addition, if a person is not on track to meet their objectives, an adviser can assist them
by putting in place the appropriate strategies or setting more realistic objectives.

COVID-19 has made all Malaysians aware of the importance of emergency funds. Budgeting
is more than a piece of paper; it is the foundation of personal finance and wealth management.
It's more important than ever to make sure that your family is financially secure and that you're
on track to meet your financial or lifestyle goals. In a nutshell, budgeting ensures that an
individual has the appropriate amount of money at the appropriate time. And, when it comes to
budgeting, we must account for both predictable and unpredictable events. We also must avoid
mistakes in budgeting such as underestimating our expenses, inflexible budget and lack of
discipline. In order for someone to successfully budget their expenditure, it requires systematic
process. The first step is tracking personal spending for 2-3 months before start budgeting. Next,
apply the 30 days rule of no impulse purchasing. Finally, we must choose wisely whether we
want to save or invest our money depends on our level of income.
4. Effects of COVID-19 on Retirement Planning

Malaysians, like people in many other countries, are heavily dipping into their retirement
savings to deal with the pandemic crisis. This is due in part to the government's policy of
loosening restrictions, allowing Malaysians to withdraw their contributions to the Employees
Provident Fund (EPF), the country's largest pension fund, in order to relieve financial hardship.

Our retirees may be using their retirement funds to assist in the repayment of loans in order
to avoid defaults, which could result in a "black mark" in the CCRIS and CTOS records. This
could cause issues in the future, particularly if they plan to seek new bank financing. Many
people who rely on such withdrawals to stay afloat will end up with a small amount of money
when they retire, risking their long-term returns.

The global health crisis has resulted in lower pension contributions, lower investment
returns, and higher government debt as a result of the economic downturn. Eventually, this will
have an impact on future pensions, with some people working longer and others retiring with a
lower standard of living. The global pandemic has made retiring even more difficult.

It's worth noting that the coronavirus outbreak has worsened the financial situation of more
than half of those in their 50s and 60s. Furthermore, the lockdowns have had a significant impact
on their physical and mental health. This could continue if coronavirus recovery continues to
treat this generation as an afterthought.

In Malaysia, a lost generation will likely retire in poorer health and financial circumstances
than those who came before them. They are likely to have a less-than-pleasant retirement ahead
of them. This could cause structural and individual problems for the Malaysian economy and
society. It will worsen our high household debt-to-gross domestic product (GDP) ratio, which is
already concerning.

To ensure effectiveness and policy consistency, efforts to address this problem must be
made quickly and in concert with other parties. Our financial and capital markets must prioritize
the development of a fintech ecosystem and the application of digital technology, as well as
improving financial literacy and personal finance management and planning.
https://www.cdc.gov/coronavirus/2019-ncov/your-health/about-covid-19/basics-covid-19.html
https://www.frontiersin.org/articles/10.3389/fpubh.2020.00241/full
Jantan, Mohd Sedek and Joe, Tiong Lih and Abdul Rashid, Abdul Aqil and Abdul Halim,
Nurul Anis and Xiang, Lim Yit, Navigating Personal Finance during the Coronavirus
Pandemic (September 8, 2020). Available at SSRN: https://ssrn.com/abstract=3690980

https://www.thestar.com.my/business/business-news/2021/07/19/pandemic-tightens-the-
noose-on-retirement