Pandemics and poverty

Most pandemics are natural and begin with pathogens leaping from wild or domesticated animals to humans, in what is called a ‘zoonotic spark’.

Mostly, such pathogens originate in Central Africa, and South and Southeast Asia as these regions, being home to most of the global poor, are experiencing rapid expansions in human settlements, intensifying agricultural and livestock production, increasing exploitation of natural resources and destruction of natural habitat of animals. This brings wild birds and animals closer to humans and causes epidemics as well as pandemics such as Covid-19.

Notwithstanding where a pandemic starts, it is the poor who bear the burnt in low and middle income countries (LMICs) due to the limited capacity to handle such surges. Even if a vaccine is developed, it won’t reach the markets of the LMICs due to vaccine nationalism and as per market logic – the market always responds to demand and that demand always comes from the rich countries first.

It may be recalled that during the Swine Flu Pandemic, rich countries had secured large advance orders for vaccines and, despite the efforts of the World Health Organization, the poorer countries were crowded out. These same distributional inequalities are likely to play out within poor countries in case of a Covid-19 vaccine. The rich will be the first ones to have access to a vaccine and the most vulnerable will be left out with fewer pandemic response resources – fewer health workers, fewer clinics and less medicine.

Pandemics can cause enormous economic damage as a result of lockdowns, closures of markets, workers falling sick, fearful people avoiding markets and public places and quarantines and social distancing, isolation reducing travel and trade. Acute economic disruption carries huge risks for poor households whose livelihoods have already been jeopardized.

Oxfam’s report ‘Dignity Not Destitution’ presents fresh analysis which suggests that between six and eight percent of the global population could be forced into poverty as governments shut down entire economies to manage the spread of the virus. The report adds “the economic fallout from the coronavirus pandemic could push half a billion more people into poverty unless urgent action is taken to bail out developing countries”.

The UN study titled ‘Estimates of the impact of Covid-19 on global poverty’ says that Covid-19 poses a real challenge to the realization of Sustainable Development Goals (SDGs) to end poverty by 2030 because global poverty could increase for the first time since 1990 and, depending on the poverty line, such increase could represent a reversal of approximately a decade in the world’s progress in reducing poverty.

The Covid-19 pandemic has done two things: it has made the poor poorer and has created a new strata of poor. The US and the UK are the worst hit countries in terms of unemployment and economic damages. The US is facing the highest number of unemployed. According to new data, unemployment in the US has reached 14.7 percent, higher than the unemployment during the Great Depression. Steven Menuhin, US treasury secretary, has said that it could be close to 25 percent. Almost 20.4 million people have lost jobs.

The data compiled by the Centers for Disease Control and Prevention (CDC), shows that black people are hospitalized at a higher rate than white people. The data from the US coronavirus pandemic exposes how systemic racism and inequality put minority groups at risk. In New York, the epicenter of the pandemic in the US, the coronavirus is killing African Americans and Hispanics at twice the rate of white people, according to preliminary state data.

Pakistan, being a developing country with less resources, has also been hit hard by the Covid-19 pandemic. Its economy has been sent into a tailspin. According to the IMF’s forecast, its GDP growth will be around 1.4 percent. With a rising number of infections and deaths amid the relaxation of lockdown by the federal government, the virus has affected the poor the most.

Lockdown, no lockdown or smart lockdown, there will be more deaths but we have to see whether economic hunger and starvation will cause more deaths or the Covid-19 pandemic. I think the spread of the virus will cause more deaths as the WHO in its study on Pakistan has warned that if care is not taken then infection cases can spike to 200,000 by mid-July. So, we have to be very prudent in choosing our options. As I have already written in these pages, our policy is guided more by the sweet wishes of our rulers than any rationality.

Poverty in Pakistan is multidimensional. Usually, economists define poverty as material deprivation or lack of basic human needs such as education, healthcare, housing, food, shelter and clothing. Those that do not have access to these inputs won’t be able to protect themselves against deadly pandemics like Covid-19. Amartya Sen, a Nobel laureate economist, has contributed significantly towards defining poverty. To him, poverty is the lack of ability to survive and grow. In this regard, he, along with Dr Mahboobul Haq, presented a concept of human development that focuses mainly on the creation of human capital through investment in health and education as these two factors enable a person to live with dignity and respect.

Unfortunately, the record of Pakistan with regard to investment in human development is very dismal. We hardly spend 2 percent of our GDP on education and 0.52 percent on health, though health has now been transferred to provinces under the 18th Amendment. Yet, the federal government bears the constitutional responsibility to support provinces in case of pandemics.

There are multiple causes of poverty in Pakistan that range from uneven distribution of resources, an unjust taxation system to an uneducated population. The poor have been abandoned by both state and market, which are unwilling to invest in the poor to raise their capacity so that they become productive agents of society. Most of the time, our economy has remained under IMF tutelage that not only favours the rich and neglects the poor, due to which the poor are invisible on development agendas, but also promotes inequalities in society.

Overall, the Pakistani system favours the rich to be richer because there is a misconception that it is the rich who have the ability to tackle the problems of the poor. But we have seen not only in Pakistan but throughout the world that this approach has caused more poverty.

In a scathing criticism of the Pakistani elite, former director of the United Nations Development Program (UNDP) for Pakistan Marc-André Franche said that the only way a critical change could happen in the country was when the influential, the politicians and the wealthy, would sacrifice short-term, individual and family interests for the benefit of the nation.

“You cannot have an elite that takes advantage of very cheap and uneducated labour when it comes to making money, and when it is time to party it is found in London, and when it’s time to buy things it is in Dubai, and when it’s time to buy property it invests in Dubai or Europe or New York. The elite needs to decide do they want a country or not,” says Marc

With the world hit by the Covid-19 pandemic, there is an urgent need for global solidarity among both developed and developing nations to focus more on cooperation and sharing of resources to work for global commons such as challenging the destruction of the ecosystem, and poverty and inequalities so that the poor can survive such pandemics.

The writer works as professor in the department of management sciences at SZABIST, Karachi.

Email: isran@szabist.edu.pk