Daily Times

During times of great crisis, such as World War II, citizens have proved willing to accept-even embrace-greater government control of the economy. Already, there has been economic intervention on a scale that hasn’t been seen for decades, if at all. Governments across the globe had announced stimulus plans amounting to $10.6 trillion-the equivalent of eight Marshall Plans. Most spending is directed to three areas i.e. supporting citizens’ basic needs, preserving jobs, and helping businesses to survive another day.

In this regard, Pakistan and India is making direct cash transfers to needy citizens. Pakistan government has launched its own initiatives, including the Ehsaas Program, which has been providing cash assistance of 12,000 rupees (approximately $75) to low-income families. Within a few weeks, the government managed to disburse 55 billion rupees (about $344 million) to 4.6 million families that registered for the program through a text-message service.

State Bank of Pakistan (SBP) had announced the Refinance Scheme for Payment of Wages and Salaries to the Workers and Employees of Business Concerns to support the employment of workers in the face of economic challenges posed by the spread of COVID-19. The core objective of this refinance scheme is to incentivize businesses to not lay off their workers during COVID-19 Pandemic. Scheme is available to all businesses in Pakistan through banks and will cover all types of employees including permanent, contractual, daily wages as well as outsourced workers. The banks will not charge any loan processing fee, credit limit fee or prepayment penalties for loans under this scheme. A grace period of six months will be allowed to the borrowers while the repayment of the principal amount will be made in two years.

Likewise, Indonesia is expanding social-welfare benefits to ten million more households. Britain and France are covering wages (up to 80 percent) of workers affected by COVID-19; Italy is suspending loan and mortgage payments; Brazil is easing labor regulations on companies. And central banks from Australia to Europe to South Africa to Canada are cutting rates.

Nurturing a next normal that will be better than what it replaced will be a long-term test of all our institutions, global and local, public and private

A push to redefine the global public-health ecosystem to navigate possible future pandemics and related threats better could provide additional impetus for cross-country public-sector intervention. Reform of financial institutions gained momentum in 2009, and the same could be true for public health in the near future.

As it was opined about the governments by the Washington Post in the context of climate change, “the tremendous costs of being the payer, lender, and insurer of last resort may prompt governments to take a much more active role in ensuring resiliency.” The implications for the role of the state will materially affect the way business is conducted; business leaders in many more sectors will have to adjust to the next normal of greater government intervention.

At some point, governments may decide to get out of the business of business; how they do so will be complicated and differentiated. How much, how fast, and in what ways governments reduce their economic role will be one of the most important questions of the next decade.

For millennial and members of Generation Z-those born between 1980 and 2012-this crisis represents the biggest disruption they have faced. Their attitudes may be changed profoundly and in ways that are hard to predict. The tourism, travel, and hospitality sectors may see their businesses subject to long-term changes in business and individual travel preferences. The list of questions about how consumers will behave after COVID-19 is long, and uncertainty is high. As a result, this is the subject of much research by think tanks.

Finding the silver linings

If necessity is the mother of invention-and it often is-there could be some positive outcomes of the corona crisis. These are unlikely to come anywhere near to compensating for the human and economic toll it is wreaking. However, given the general shortage of optimism at the moment, it may be heartening to consider a few encouraging possibilities.

One has to do with the human imperative to communicate. In this sense, the death of distance continues to be very real, and very positive. Individuals, communities, businesses, and governments alike are all learning new ways to connect: almost everyone knows a story of the parent and grandparent who finally learned to Facebook Messenger, WatsApp video Call, Zoom, Skype, or FaceTime.

For businesses, the consequences have been profound. Many have learned how to operate remotely-and at a high level and at far greater speed. These practices could well stick, making for better management and more flexible workforces. Flexible work is often critical to support employees at different life stages such as parents with young kids and women during parts of their career.

Business leaders now have a better sense of what can, and cannot, be done outside their companies’ traditional processes. Many are beginning to appreciate the speed with which their organizations can move once they change how they do things. In short, the coronavirus is forcing both the pace and scale of workplace innovation. Indeed, as businesses are forced to do more with less, many are finding better, simpler, less expensive, and faster ways to operate.

The urgency of addressing COVID-19 has also led to innovations in biotech, vaccine development, and the regulatory regimes that govern drug development, so that treatments can be approved and tried faster. In many countries, health systems have been hard to reform; this crisis has made the difficult much easier to achieve. The result should be more resilient, responsive, and effective health systems.

These silver linings are thin compared with the scale of the coronavirus catastrophe. Nurturing a next normal that will be better than what it replaced will be a long-term test of all our institutions, global and local, public and private. It will be critical to reconstruct for the future and not solve for the problems of the past.

One possible next normal is that decisions made during and after the crisis lead to less prosperity, slower growth, widening inequality, bloated government bureaucracies, and rigid borders. Or it could be that the decisions made during this crisis lead to a burst of innovation and productivity, more resilient industries, smarter government at all levels, and the emergence of a reconnected world. Neither is inevitable; indeed, the outcome is probably more likely to be a mix. The point is that where the world lands is a matter of choice-of countless decisions to be made by individuals, companies, governments, and institutions.

The early 20th-century British explorer Ernest Shackleton once noted, “Optimism is true moral courage.” Optimism and courage: these qualities are needed more than ever as world leaders make the decisions that will shape the next normal.

(Concluded)

The writer is an old Ravian, can be reached at saudzafar5@gmil.com