Nearly two months after it first originated in Wuhan, the capital city of Hubei province in China, the lethal COVID-19 virus pandemic has now become more than a health emergency. At the time of writing this article, the epidemic has spread rapidly worldwide to more than 101 countries, infecting 1,19,214 people and claiming over 4,298 lives.
The alarming situation created by the disease has mandated the World Health Organization (WHO) in declaring the new series of coronavirus (which likely transmitted to people from animals), as a Public Health Emergency of International Concern. As China is predominately connected to the whole globe, the disease’s capability to spread from human-to-human contact has reached an all-time high. Not only this, the virus has also affected the social, cultural, economic, political and in some instances even the diplomatic relations between China and rest of the world.
Impacts of the coronavirus on the Chinese and the world economy is lately proving to be catastrophic. As the virus is rapidly spreading across the Western world, the world’s biggest companies have begun to paint a bleak picture of broken supply chains, disrupted manufacturing, empty stores and low demand for their wares. Similarly, the Organization for Economic Co-operation and Development (OECD) has revealed that since the outbreak of the virus, the global Gross Domestic Production (GDP) has fallen by half a percentage to 2.4 percent, which is the lowest rate since the global economic crisis of 2008/09. Moreover, with oil prices plummeting and stock market further sinking down, one can easily comprehend the major economic, social and political impact that the virus could fabricate around the globe.
In this regard, Nepal as a close neighbour to China too has felt the pinch of the virus outbreak. Although the nation stands in the list of least affected countries globally with just one confirmed case, the government has started taking stern actions to control any impacts or repercussions that the virus might create on the nation’s economy. From introducing thermal screening (via thermal cameras) at Tribhuvan International Airport (TIA) to opening a quarantine facility (at Kharipati) for those who come in contact with the virus; the government has left no stones unturned in preparing the nation for any possible breakout. Nevertheless, more concrete efforts are required if the nation is to actually tackle the epidemic as the country is still lagging behind in terms of providing adequate and standard pharmaceutical and healthcare services to its citizens.
The severity of the virus in Nepal can be better understood through these socio-economic lenses:
Manufacturing sector: The supply of raw materials and other manufacturing parts have been severely impacted due to the outbreak of the coronavirus. As Nepal’s pharmaceutical industry is heavily dependent on China for various chemicals that are needed to make medicines, the closure of border points and the subsequent short supply of basic goods has acutely affected the manufacturing industry.
Wholesale and retail sector: Nepal imports nearly 70 percent of its apparel items from China via the ‘Rasuwagadhi-Kerung’ and ‘Tatopani-Khasa’ border point. However, as the Northern borders have been kept on indefinite lockdown since 28th of January to prevent the outbreak of the virus, hundreds of trucks and containers have been stalled on the Chinese side of the border. This has resulted in the shortage of cheap Chinese apparel and retail items in domestic markets across the nation.
Panic Buying: Haphazard and panic buying by the public have also weakened the supply chain for many retailers across the nation. Fearing any possible blockade in either the Southern or Northern borders, common Nepalese have started hoarding up many basic commodities such as- rice, lentils, oil, cylinder, hand-sanitizers, alcohol-based soaps, medicines, masks etc. This has not only increased the market price for such products in the domestic market but has also reduced the supply for the same.
Tourism sector: With the government officially cancelling many of its promotional events and activities for the upcoming months such as the Nepal-India-China Expo, 10th International Nepal Tattoo Convention, Sagarmatha Sambaad; The Visit Nepal Year 2020 campaign too has been critically affected by the spread of the coronavirus Since January, the nation has seen a dip of 2 percent in its tourist’s arrival as tourists around the globe have been reducing unnecessary travel by cancelling most of their foreign trips. Due to this, various community homestays, hotels, recreational agencies and airlines have experienced a huge fall in their booking rate. In this light, officials at Hotels Association Nepal (HAN) have confirmed that the average occupancy at hotels has reduced by almost half during the same period.
Foreign Employment: Nepal’s economy is heavily reliant on remittance earning and foreign employment. The nation receives more than 50 percent of its total remittance from five major Gulf nations- United Arab Emirates (UAE), Saudi Arabia, Bahrain, Qatar and Kuwait. However, the wide-scale outbreak of the virus in these countries has led to the closure of many factories, industries and other business units, where Nepali migrants are employed, further pushing them into a phase of involuntary unemployment. The recent temporary entry ban for Nepali migrant workers by Qatar amidst the outbreak has left nearly 40,000 workers with valid work permits unable to fly to their work destinations. Similarly, the Ministry of Labour, Employment and Social Security has also been contemplating whether to halt the issue of labour permits to migrant workers for nations that have been most affected by the virus. As many Nepali households are directly dependent on remittance for their daily consumption needs, any changes in remittance earning can have a stern impact on the overall consumption and purchasing pattern of the nation.
Airlines Stock: Airlines stock has been among the biggest casualties of the stock market in the wake of the virus outbreak. Airlines are currently experiencing demand weaknesses within and outside the nation, as passengers are cancelling their flights in fear of the disease and other travel restrictions imposed by the government. This has affected the incentive for both- business drive and revenue generation for airline corporations.
The global implications of the COVID-19 virus cannot be controlled through a single nation’s efforts, as it needs quick, effective and combined containment measures from nations across the globe. In this regard, weaker and lesser prepared nations like Nepal are anticipated to be exposed to greater risks than any other developed countries. While the social and health consequences of the virus have been quite visible since its first appearance; the economic and political impact of the virus has escalated substantially in the past few weeks. The outbreak has induced mayhem in the manufacturing, retail, industrial, tourism, and stock market; and as of now, there are only a few sectors that have remained immune to the same. Therefore, it’s imperative for the global community to come forward and work together to ensure that the disease is controlled without any further delay; otherwise, the COVID-19 virus can render the whole world in complete despair and isolation.
 “Outbreak of Coronavirus in China: impact on the region”, Hari Bansh Jha, Observer Research Foundation, 13 February 2020. Retrieved from- https://www.orfonline.org/expert-speak/outbreak-of-coronovirus-in-china-impact-on-the-region-61342/
 “How bad could it get? Companies gauge the coronavirus impact”, The New York Times, 28 February 2020. Retrieved from- https://www.nytimes.com/2020/02/28/business/economy/companies-coronavirus-economy.html
 “Nepali economy starts to feel the pinch as coronavirus spreads”, Prithvi Man Shrestha, The Kathmandu Post, 04 March 2020. Retrieved from- https://kathmandupost.com/national/2020/03/04/nepali-economy-starts-to-feel-the-pinch-as-coronavirus-spreads