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New COVID-19 report says challenges far from over

chinadaily.com.cn | Updated: 2020-08-19 16:34
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This interview with Doctor Dan Steinbock, the author of the new report, “The Worst is Still Ahead”, suggests COVID-19 challenges are far from over. The pandemic is still spreading and could become more virulent. Several major economies face “l(fā)ost years”.

Q: Are there signs of an end to the global pandemic?

A: Not anytime soon. At this rate, the accumulated confirmed cases could exceed 25 million by the end of August. In the absence of deceleration, these cases could soar to 50-60 million and deaths to 1.3 to 1.7 million by the year’s end. Worse, due to limited testing and inadequate data, a great number of cases and deaths continue to go undetected, particularly in the poorer economies. By default, official estimates downplay the effective pandemic impact.

Q: You predicted the escalation of COVID-19 internationally in early February, the coronavirus contraction in mid-March and the subsequent US pandemic crisis. Has the status quo improved in the US?

A: Not yet. With the elevated pandemic impact, the economic collateral damage continues to deepen. Due to late mobilization and ineffective responses, defective herd immunity has been fostered in major advanced economies and poorer nations, as evidenced by the COVID-19 resurgences in the US and the Americas.  If US states were sovereign entities, by August they accounted for 23 of the top 25 most virus-affected economies worldwide, as measured by confirmed cases per capita.

Q: Did the Trump administration fail to contain the outbreak?

A: Yes, but that’s an understatement. Moreover, the administration’s planned exit from the World Health Organization is likely to compound new pandemic risks over time.

Q: Recently, a “more infectious” COVID-19 strain was found in tested samples in Quezon City in metro Manila. In your report and prior commentaries, you have urged vigilance about this strain in Asia, Africa and some other major regions.

A: Yes, I have. Vigilance is absolutely needed because the COVID-19 progression may have been amplified by an adverse mutation. In the Philippines, Quezon City has been one of the worst-hit cities but we do not know enough about the samples. In small numbers, this strain has been around, which too many sensationalistic headlines have ignored recently. The real issue is about predominance.

Q: Can you elaborate?

A: Sure. As my report notes, in Wuhan, China and Asia, the virus was initially dominated by the original ‘D’ variation. In March, a more virulent ‘G’ variation evolved in Europe and then in the US and it has predominated infections in proximate regions after March. If these research results prove valid, Asia and Africa and certain other regions, particularly poorer economies with fewer resources and weaker health systems, could soon face more aggressive virus strains that the lockdowns and travel restrictions in the West have so far kept in check. Moreover, the G strain could complicate vaccine effectiveness.

Q: In your first report, you argued that the International Monetary Fund baseline scenarios were far too optimistic. That proved to be the case. In June, the IMF released updated scenarios, which suggest deeper contractions. Are they in line with realities? 

A: No, not yet. Baseline scenarios still underestimate collateral economic damage for three reasons. The IMF update downplays the impact of the prior grim global economic landscape. It underestimates the adverse impact of the secondary virus waves, which began in the summer. And it largely suspends the likely negative impact of the escalating US Cold War against China and several other countries.

Q: So collateral damage will still deepen along with "lost years"?

A: Yes. The impact has been relatively worse in those major economies that were coping with challenges already before the coronavirus contraction. Among high-income economies, most may face 4-7 years of lost progress, as measured by significant erosion of capita incomes. In some economies, prior challenges are contributing to greater declines (e.g., Italy, Japan). Among upper middle-income economies, China and possibly Indonesia may navigate through the crisis without negative contraction. But most countries have already lost 5-7 years of progress and in some cases, typically Brazil and Argentina, the lost years could prove worse than expected.

Q: What about poorer economies?

A: Among lower middle-income economies, even the best performers have already lost 3-4 years (India, Kenya, Philippines, and Vietnam), while others may lose a decade (Nigeria). Among low-income economies, the best performers have lost 5-7 years of progress (Ethiopia, Mozambique). Some have had losses of up to 20 years (Madagascar), or over 25 years (Yemen). These countries suffered from falling living standards long before the pandemic, due to political instability, civil war and foreign invasions. But the pandemic could contribute to "perfect storms."

Q: Why has it been so hard to contain COVID-19?

A: With outbreaks, time is vital. Key countries have the ability but haven't had the willingness to take the pandemic seriously enough. In Asia, the experience of SARS “taught” people the importance of taking these outbreaks very seriously. Consequently, face masks, social distancing, appropriate disinfection and other measures were adopted very early. In the United States and in some European countries, the approach has been very different, which has proved costly and deadly. Despite China's trend-setting quarantine measures starting in late January, the US and Western Europe did not start to fully mobilize against the virus until late March. Initial responses proved ineffective and exits were launched far too early. Worse, surveys suggest that, given a vaccine, many in the West would refuse to use it.

Q: What should be done?

A: Effective international response would require strong leadership and multilateral cooperation, which still remains weak. Consider this: The WHO’s updated fund-raising target represents barely 0.01 percent of the world’s (current) cumulative output loss. Yet, several key economies continue to shun pre-emptive, long-term strategies. Strong multilateral global action would be vastly preferable to (and only a fraction of the cost of) unilateral actions, which compound pandemic damage.

Q: What do we need?

A: Multilateral cooperation among all major economies and across political differences. Global pandemics are not overcome by political ploys, re-election campaigns and other efforts at private gains. Second, only evidence-based decision-making that relies on modern science can provide the basis for success.

Q: Have we learned the necessary lessons from past mistakes?

A: Before COVID-19, many certainly thought so. But that was Pollyannish. With the Spanish flu, it was not the first wave that proved fatal, but the second. If we still haven't learned that lesson, we may be forced to re-learn it over a major crisis - a more protracted pandemic and a multiyear global depression.

Doctor Dan Steinbock is an internationally recognized strategist of the multipolar world and the founder of Difference Group. He has served at the India, China and America Institute (USA), Shanghai Institutes for International Studies (China) and the EU Center (Singapore).

Difference Group conducted this interview. The opinions expressed here are those of the writer and do not represent the views of China Daily and China Daily website.

 

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