Skip to content
search
Wealth COVID-19 Update: Healthcare Or Economics? A Quick Look At One Of 2020's Biggest Debates

COVID-19 Update: Healthcare Or Economics? A Quick Look At One Of 2020's Biggest Debates

COVID-19 Update: Healthcare Or Economics? A Quick Look At One Of 2020's Biggest Debates
Photo: Unsplash
By Ryanne Co
By Ryanne Co
August 19, 2020
How does one choose between healthcare or economics? Tatler takes a look at what it means to decide between two of the most important aspects of society today.

There is much to be said about the current situation in the Philippines. Despite undergoing the world's longest lockdown — spanning five months and counting — the country has yet to flatten the curve or even ride out its first wave. Healthcare workers argue that as the count of positive cases continues to increase, so does the need to enforce a stricter community quarantine. Earlier in the month, after much speculation, the government acquiesced to reimpose stricter lockdown measures in Metro Manila. Needless to say, this has sparked an even more impassioned debate between healthcare and economics. 

Both sides have very valid arguments as to why we should or should not revert to stricter lockdown measures. Speaking in an economic context, a stricter community quarantine will do no favours for businesses and their workers. Due to the prolonged stagnancy of our initial three-month lockdown, the Philippines has already hit a recession as of 06 August 2020. Those fortunate enough not to feel its effects (yet) may wonder: what is a recession?

What is a recession?

According to Forbes, a recession is "a significant decline in economic activity that lasts for months or even years". This can happen for a number of reasons and is unavoidable in the business cycle. A recession usually manifests itself as a negative gross domestic product (GDP), rising levels of unemployment, and declining retail sales. What's significant about the current recession is how dramatic the economic contraction was. Economic growth shrank by 16.5 per cent last quarter, which is the lowest since 1981. While there had been episodes of negative growth in quarters throughout 1991 and 1998, this is the most significant contraction we've seen in nearly three decades. 

Photo: Unsplash
Photo: Unsplash

Outlook From Experts

For now, economists hope that the recovery will be quick and steady. Of course, that could very well not be the case. The most optimistic outlook would be the V-shaped recovery where a very sharp downturn will come with a very sharp upturn too. There's also the W-shaped recovery, which comes in a zigzag motion of ups and downs. A U-shaped recovery will be slow but steady growth over time. However, an economist at ING Philippines, Nicholas Mapa, recently predicted that our local outlook could very well come at an L-shape. This is the most pessimistic outlook, which is characterised by "persistent unemployment and stagnant economic growth". This news comes at a time when unemployment is at a record high at 45.5 per cent — meaning around 27.3 million are out of work.

Considering that before the pandemic, the Philippine economy was on a streak at 84 quarters of continuous growth, this downturn comes as a bit of a disappointment. On a global scale, the International Monetary Fund (IMF) sees the global economy to shrink by 4.9 per cent this year

Read also: The State Of The Philippine Art Scene During The Covid-19 Pandemic

Healthcare Versus Economics

It's hard to debate on a topic as loaded as healthcare or economics; surely it's important for people to feel safe in both scenarios. Unfortunately, with the way the choice is presented to us sometimes, it can come across as an either/or representation. However, some argue that choosing between the two is actually a false dichotomy.

Ronald Mendoza, Dean at the Ateneo School of Government says that countries who have boosted healthcare systems and implemented more effective test-trace-treat systems are better able to mitigate the risks of opening up the economy. Looking at it through the lens of New Zealand,  a country which has been highly praised for its effectiveness in flattening the curve, we can observe that although they did take an economic hit during their lockdown, they were also able to quickly rebound in the 100 days when there was no community transmission. This shows a proper V-shaped recovery.

New Zealand economist, Shamubeel Eaqub, also argues that countries who have implemented successful lockdowns (which were able to curb the virus) are doing much better economically than countries who have not been able to do so. He also stated that if the virus gets out of control (in New Zealand), that their (local) economy would also have taken a much bigger hit in the long-run. 

Of course, it is very important to view such restrictions in the context of the Philippines and not New Zealand. People must be cautious against a one size fits all response, considering that each country has its own advantages and limitations. However, in a recent journal article published on 16 May 2020, researchers suggested that instead of juxtaposing economic activity against epidemiological risk, it would be better to view it in a more balanced perspective of "acknowledging socioeconomically determined risk alongside epidemiological risk". 

Read also: MECQ, GCQ, And More: Are Lockdowns And City-Wide Quarantines Truly Helpful?

 

Photo: Unsplash
Photo: Unsplash

Technological Advancements

One of the biggest advantages we have today is the number of technological innovations available. This is not only beneficial for the field of medicine, but it can also help uplift the economy. A few people have been managing to work at home quite well, leaving them at a comfortable position of staying safe while being able to generate income. 

Lately, there's also been a surge in e-commerce. Nowadays, social media and the Internet aren't just used for advertising, it can also be used as a direct-to-buy shop. These include Instagram stores started by entrepreneurial minds, as well as online platforms such as Lazada and Shopee (which will soon be taxed because of its popularity among consumers). 

Service apps can also be a big help in boosting the economy. Plenty of people now rely on such to go shopping, get food delivered, and even look for services (such as home-cleaning or repair). Apps that offer services on demand (like MyKuya or Grab) are helpful not just for merchants, but consumers and job seekers as well.

Of course, it's important to acknowledge that not everyone has access to technology or the Internet. Many people still rely on jobs that require them to be outside or to help others who need things done while being socially distant. This brings us back to why it is so important for us as a country to be able to better mitigate the situation outside our homes. We need to be able to balance both aspects so that everyone can benefit from a stable economy as well as a safe and healthy environment. 

Tags

Wealth economy

clear
keyboard_arrow_up

In order to provide you with the best possible experience, this website uses cookies. For more information, please refer to our Privacy Policy.

close