The one-day shocker on the bourses has left the market capitalization lesser by US$ 5 trillion, or Rs. 3,60,00,000 crores. The fear of a contagion spread by COVID-19 has been the reason for the same.
What cannot be debated is the overall damp squib world economic scenario, which began with the US trade war with China and Brexit. Situations are volatile in many European nations like France, Spain, Portugal and Germany, which are struggling to maintain previous year levels of performance. There is also disquiet in Bolivia, Peru, Venezuela and Brazil. War in Syria, Libya, disquiet in Iran and Iraq have all led to nervousness for the investors.
On the environmental front, fires ravaged Amazon forests, costing Brazil dearly as did the Australian fires, which singed their economy. Floods are keeping Jakarta submerged. Heatwaves and melting glaciers have redrawn the fortunes of many countries, all for the worse. The year 2019 has been bad worse than many previous years for the world.
In this backdrop, COVID-19 has struck, like a bolt from the blue. More than 3000 people have died, many in China, the country where the case originated. There are more than 89000 people infected with the virus all over the world. Many fliers, moviegoers, train travellers, holidaymakers in cruises, could be ignorant of their spreading the virus.
A medical solution will soon be found, but until then, the virus must not spread into a pandemic. What is scary is the quick spread in countries, where the COVID-19 case is noticed for the first time, like in Italy, which has recorded 17 fatalities already. Iran is another critical nation, where more than 380 persons are infected. We are just one wall away, Pakistan, which too has an abysmal record of tackling such epidemics. Pakistan has never closed its airline’s operation, and many Chinese are landing in Pakistan every day in connection with their OBOR project. They can be a potential source for the spread of the virus in Pakistan and eventually into India.
It is better to be preventive than looking for a cure. Still, the government must be in a state of preparedness, with beds, quarantine facilities, and adequate medical supplies including face masks and alcoholic handwash preparations. The ordinary people ideally may avoid air travel (a high-risk area of spread), closed and crowded halls. All must practice a high standard of hygiene, no hugging, kissing and rubbing cheeks and no handshakes. A namaste is a graceful gesture as the world is realizing. The initial symptoms are fever and DRY cough.
The US President’s yesterday stated that the ill effects of COVID-19 are more hyped than real, maybe to calm down the melting stock markets. A loss of $ 3.5 Trillion for the US in a day is more than their expenses sustained in engaging with the Taliban in Afghanistan in the last two decades (US$ 2.4 Trillion).
The death tolls and the spread of the virus during the weekend will have a sway over the bourses as it opens on Monday, which will take a few months to recover from the fall. For an optimistic Finance Minister of India, the COVID-19 could not have shocked in a worse time. I hope this too passes off soon.
Sampath Kumar
Intrépide Voix
