In the wake of the successful control of the initial outbreak of Covid-19, and tributes paid from other nations on how the Government restrained the spread, it is no secret that a sense of complacency prevailed in the Sri Lankan society. Instead of being alert, and despite continuous warnings from the health authorities, the public relaxed the guard and behaved as if nothing has happened. The people completely disregarded the ‘new normalcy’ concept. This includes not only the general public but politicians of all levels and the media as well. The false positivity that prevailed across the country has proven to be lethal.
The latest cluster identified in the Gampaha district has spiked much faster than on the previous occasion, and the total number infected increased by more than a third in a matter of days. The health authorities said this time around the ‘virus load’ seems more when infected and demonstrates faster transmission. However, the consolation is that the authorities seem to have controlled the situation. Almost all new cases reported are related to the same cluster.
Overall growth
Previously, the countrywide, long-term lockdown protected the nation from the pandemic while giving an unparalleled sucker punch to the economy. The impact of the lockdown has shuttered the economy and dragged Sri Lanka to a low overall growth. However, unlike many other countries hit by the novel virus, Sri Lanka bounced back speedily and was on the way to full recovery when the new cluster appeared suddenly.
It is a fact that the economy was not facing a headwind even before the pandemic appeared in January this year. Due to the mismanagement of economic affairs throughout the previous regime, conditions were gloomy with a continuous downward trend in economic growth. Therefore, the blow created by the first outbreak was enormous.
On the previous occasion, the Government was compelled to postpone many development programs as the expenditure of curtailing the pandemic was beyond all means. President Gotabaya Rajapaksa has offered various relief packages to almost all who faced hardships, including the two-time relief package of Rs. 5,000/- each. The relief schemes dug deep into the Government coffers posing the question whether the country could bear another total lockdown. However, it is a relief that the authorities now rule out such a countrywide lockdown as the situation is still under control.
Sri Lanka as a small and open economy cannot withstand another economic shock. In fact, no government in the world, irrespective of the economic sanding, has economic resources, political backing or, public support to sustain another countrywide lockdown. Especially, when the global economy has contracted further due to the ongoing pandemic situation in the USA and the new hotspots in European countries, with a high number of patients, assistance to Sri Lanka from the world by way of funds is uncertain. Therefore, the best remedy is to rally round to control the further spread of the new cluster.
Of the three main foreign exchange sources (foreign employment, apparel, and tourism), the apparel industry was the only resource that was on the recovery path. The industry will be in dire straits if the present situation is not brought under control as early as possible. The Gampaha district that records the highest number of apparel industries after Colombo is currently undergoing tremendous difficulties in completing the existing export orders due to the prevailing curfew. Related industry sources revealed that the workers are reluctant to report for work and even the employees who are agreeable are unable to do so due to the curfew. Industry sources operating in the locked-down area say the buyers will be extremely unhappy if the ongoing orders cannot be met on time. The overall impact in such a situation will be immensely damaging to the reputation and the trust established so far by the Sri Lankan apparel sector.
Business activities were slowly but steadily on the path to recovery before the new blow occurred. Although the infections are mainly restricted to the Gampaha district, the whole country is on the alert. Even without a curfew in Colombo, business activities, particularly retail trade is displaying a lull. The consumption is likely to remain subdued in the coming months.
Development programs
However, the good news is that President Rajapaksa seems to be going ahead with most of his development programs while at the same time focusing attention to the emergency. The President and his government are undoubtedly strong enough to confront the current crisis as a temporary setback. Despite countless challenges, there are encouraging signs that Sri Lanka is faring comparatively better than many other countries. While the economy is expected to be in sharp contraction and the prevailing uncertainty of the time of return to economic normalcy, the nation is hopeful that the President and the government will bring the situation under control.
Previously, the Government took swift action and early measures to curtail the pandemic and managed the situation efficiently, maintaining essential services and offering relief packages to the public. Even though the present spike of patients is higher, the Government, with the assistance of relevant authorities, has already taken adequate steps. The lockdown was imposed on time and the efficient military deployed promptly, getting a firm grip on the situation.
The Government must have taken a cue from China and learnt how they successfully contained the second wave. During the second wave, fearing that the new outbreak is more contagious, as in Sri Lanka at present, the Chinese government introduced stringent new rules. Similarly, the Minister of Health has announced that new laws on the disease will be gazetted soon and offenders who violate the law will be prosecuted. Sri Lanka needs such firm action to overcome the crisis. Most of the powerful leaders in the world are grappling with Covid-19, at times even risking their respective political careers, while President Rajapaksa gains more popularity day after day. The public not only trusts him implicitly but also backs his decisions unanimously.
Politicians in most countries, as in Sri Lanka, publicly state that they do not wish to politicise the pandemic. But, invariably they always do. However, in Sri Lanka, despite inevitable tensions, the Government has been able to get them together in a single opinion, whenever a decision has to be taken on the pandemic.
No one thought that Covid-19 would rise to this magnitude, striking the world to suffer an economic downturn, illnesses, job losses, and loss of livelihoods. The temporary relief that prevailed in the country was ended abruptly by the sudden reemergence of the virus in a stronger manner. The occurrence reminded the nation that they have to seriously conform to the new normalcy, at least until a cure is found.
Therefore, now is the time to design and implement new policies to boost the ailing economy, create more indigenous business entities, modernise government machinery, and promote a stronger social protection framework to become a high-income economy as pledged by the Government.