The economic implications of a lockdown will be multifaceted from the level of government, private sector and on individuals. This is according to Prof Peter Quartey, Director of Institute of Statistical, Social and Economic Research, ISSER.
He averred that even though the economy is resilient to an extent, there are factors that need to be looked at in the event that the measure is to be triggered. He spoke to Accra–based Joy FM.
Calls for government to consider a lockdown have been pronounced recently as coronavirus cases in the country continue to rise. Minister of information designate, Kojo Oppong Nkrumah, gave an indication that stronger virus restrictions could be in the offing. His views are produced below.
Slow down of economic activity
We certainly need a healthy population, a healthy labour force and therefore anything that threatens the livelihood, the health of the people should be curtailed as quickly as possible.
But if we should go into a lockdown, it is certainly going to slow down economic activity. Our growth projection will certainly come down because there is not much production or consumption.
Impact on employment and subsistence earners
That is also likely to affect employment as well as even government’s fiscal position because mind you when we go into lockdown, there is not much production. Revenue will go down and government might have to borrow to finance some of these government financed expenditures.
So we ought to be careful about this. Then even the livelihood of the poor, you recall when we went into about three-week lockdown; there were some agitations (from) the vulnerable, the poor.
They could not stay indoors because they live on a subsistence basis. From hand to mouth and therefore if we go into a lockdown, for how long and how do we feed them and ensure that their livelihood is not affected.
We could also have social implications and psychological implications because people like to move not to be idle and not to be restricted so that could have psychological effect on the populace as well.
A partly resilient economy
Our economy to some extent is resilient but not that much. For example we saw agriculture; when we went into a lockdown, there wasn’t a significant increase in import of food and other items.
We were able to manage food production and even consumption wasn’t a problem. There were no shortages of many commodities but then to some extent, it depends on how long you are going into a lockdown.
If it extends beyond a certain period then we might likely face some challenges. So we are resilient to some degree but not for long. We will have a problem if we go into a total lockdown.