The double-edged sword of lockdowns in the fight against coronavirus - LEVENT YILMAZ

The double-edged sword of lockdowns in the fight against coronavirus

The humanitarian and economic magnitude of the COVID-19 epidemic increases with every passing day. Almost all of the countries that only focused on containing the virus are now discussing the economic impacts of the epidemic, in addition to the humanitarian aspect of it.

While trying to strengthen their health infrastructure and procure the necessary medical equipment in the fight against the virus, countries are also announcing packages in a bid to save their economies from collapse. However, there is a serious problem at hand.

The COVID-19 dilemma

The one subject all experts can agree on is that contact needs to be kept to an absolute minimum--- if there is to be any at all. To this end, partial or full-time lockdowns are at the top of their suggestions. Policy makers have been resorting to these lockdowns ever since the World Health Organization declared the Covid19 as a “pandemic.” It is obvious that it works. The data proves this. However, this method, even though extremely important for health, has very serious economic side effects.

Flight suspensions, the closure of shopping malls and border gates, and the necessity of social distancing within the scope of partial or complete lockdowns lead to economic consequences like a decrease in demand or an absolute elimination of supply in some sectors.

It is certain that this situation will adversely affect gross product, reduce public revenues and even bring new burdens to the public, render a significant part of the private sector inoperable and eventually result in unemployment.

This also means that individuals and businesses will incur serious financial loss. However, the responsibility of those who experience a loss or suspension of income continues either way.

So governments are taking measures to at least partially compensate for these losses or delay payments, which could mean trillions of dollars, depending on the size of each country’s economy.

This burden on the government’s shoulders is doubling every day as the lockdowns continue within the context of the fight against the coronavirus. This is why policy makers want to lift the said lockdowns as soon as possible.

However, on the other hand these lockdowns have strategic importance in curbing the spread of the virus. In other words, governments have to implement partial or full lockdowns to save human lives, but also have to lift these curfews to save their economies.

So, what are they to do? It is in fact a hard decision and in all sense of the word constitutes a complete “dilemma.” We can call it the COVID-19 dilemma.

Dodging the dilemma: economic security

Governments across the globe are all currently facing the COVID-19 dilemma. They have to make a choice between extending the lockdowns they imposed to control the spread of the epidemic and lifting lockdowns in order to save their economies from recession.

Of course, it is also possible to impose a middle-way policy. However, governments need to calculate how much longer they can hold out in the economy front. This situation also directly concerns economic security. We know that those who are in a good place on economic security and have experience in dealing with non-economic indicators that affect the economy are at an advantage here. Hence, countries need to attach more importance to economic security, not only in this period of the epidemic, but in case of a second wave, and also to not be in a similar dilemma if another epidemic is to emerge.

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