COVID-19 Economic Recovery: Nepal in need of Strategy

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Nepal continued to see the surge in coronavirus cases. The number of coronavirus cases has climbed to 22,972 in total, with more than 70 deaths.

Many people in Nepal are looking for hope and a suitable reason to return to normalcy.  Now, the world faces an uphill battle as people don’t know how deadly the disease is and how widespread it can be, and when this uncertainty will end.

Lockdown is checking the spread of this deadly virus but it cannot last indefinitely, at least not causing a hard blow to our economies. Nepal is facing a drop in output unprecedented in its intensity. Our economic outline darkens daily, with businesses shutting down and people shutting in. As Nepal is enforcing lockdown to flatten the curve of coronavirus cases, the restrictions are affecting the poor. The effect of lockdown has been a walking exodus of people. If the lockdown continues indefinitely, many could be plunged into poverty, hunger or desperation.

According to the World Bank Report, the growth rate of Nepal will be in the range of 1.5-2.8 percent in the current fiscal year, followed by 1.4-2.9 percent in 2020-21 and 2.7-3.6 in 2021-22. Asian Development Bank also predicted the growth rate for Nepal to 5.3 percent from 7.1 percent for this fiscal year. Central Bureau of Statistics too predicted the minimal growth rate. One million jobs have been badly affected in tourism sectors as the nation heavily relies on this sector. For those workers who work on daily wages, the lockdown and economic decline is a tough blow.

The key to tapering off this pandemic is developing herd immunity. One is researchers would have to develop a safe and effective vaccine.  Another way is the virus will extinct after a large number of people infected with COVID-19 develop immunity. If this choice is granted, unmitigated, it would be a great cataclysm as it would cause many deaths. Both ways aren’t happening soon.

Amid such reality, Nepal needs a good strategy to see us through the next year or more. The idea of lockdown isn’t the ultimate and best panacea to combat this health crisis. The best strategy, for now, can be proactively striking a fine balance between economic resumption and retaining the reproductive number of this virus below one. We need a good national strategy to keep this pandemic under control. We need to suppress and lift the restrictions depending on its means, and its tolerance for disruption, in ways that can keep this illness understeer.

The government of Nepal can check the state of pandemic, act promptly on evidence and tune their interventions there and then. Nepal can monitor closely for news infections and adjust controls in place.

Accordingly, the government can relax in the agriculture sector. This sector contributes to 27% of Nepal’s GDP. After monitoring closely the condition, Nepal can relax major economic hubs, including Kathmandu, Chitwan, Pokhara. Similarly, the cessation of major construction projects can be relaxed partially.

Stringent measures can be taken in the areas where the number of coronavirus cases surges. Special care should be rendered to those who are vulnerable to COVID-19. Those who are at low risks can be allowed to work with precautionary measures.  They can be advised to stringently follow the safety measures. But curbing restrictions too early can also be risky and the reproductive numbers can surge again. We need to do it in a planned way and we need a good national strategy.

We have to accept that vaccine is one exit strategy for this catastrophe and it takes time.  Till then, we need the finest national strategy to see us through one or more years and endure social distancing until effective vaccine or therapeutics is on deck.

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