The latest World Economic Outlook published by the World Bank last month presents a gloomy picture of the global economy going forward, not just until the COVID 19 pandemic subsides but indeed well beyond.
The already recognized litany of economic woes are repeated with increasing intensity – a sharp slowdown in economic growth in some parts of the world and outright economic recession in others, growing unemployment, rising debt at both the public sector and private sector levels, falling new investment and so on.
Of course as an enthusiastic participant in the global economy, Ghana cannot escape this severe economic down turn. Forecasts by the Ministry of Finance and the Bank of Ghana predict economic growth falling to as low as 2.5 percent this year.
To be sure, Ghana has adopted prudent economic policy responses to the crisis, covering government’s own financial positioning and stimulus for the private sector.
However, those policy responses have been designed to weather a temporary economic storm brought about by a temporary health crisis, which itself is being addressed by prudent public policy on a wider basis aimed at curbing the spread of infection.
However we now have cause to fret that government is losing its commitment to restrict COVID 19 to being a temporary phenomenon.
A couple of days ago, a Deputy Minister of Education, while responding to calls to close schools again because of viral outbreaks among various student populations, said, to wit, that COVID 19 is not going away anytime soon so we have to learn to live with it.
This is a sharp departure from government’s initial stance of ruthlessly preventing its spread, and this seeming change of policy is confirmed by the continuous easing of erstwhile socio-economic restrictions despite clear evidence that the general populace is showing little inclination to abide by the requisite social and healthy protocols.
We further worry that this is happening even as the depth of the crises is now being inevitably understated. Simply put, with communal spread of the virus now commonplace, government cannot keep up with the real number of infections, a shortcoming further intensified by a lack of sufficient testing capacity; not only do more people have the infection than the official numbers claim, but we will not be able to keep up with the numbers from the inevitable surge in infections brought about by the ongoing voters registration exercise, the re-opening of schools and the easing of other restrictions such as on social and religious gatherings.
Eventually, this ongoing (but partly unrecorded) surge in infections will have major adverse effects on the economy. It is instructive that already key government institutions with pivotal roles in the running of the economy have started to close down because their staff are getting infected. This phenomenon will imminently spread across corporate Ghana too.
This is why we call on government not to relent in the fight against the spread of the coronavirus epidemic. True, there are dire economic costs involved in continuing the fight, but the economic costs that will accrue from losing the fight would be much higher. Lock downs and other forms of socio-economic restrictions prevent people from going to where they earn their livelihoods; but a national defeat to COVID 19, as is now on the cards, would leave the survivors with no livelihoods awaiting them even if they are allowed to move about and congregate freely.