Daily Times

The global COVID-19 outbreak is putting an immense strain on societies and economies around the globe. As the contagion is spreading globally and the world is experiencing a tragic toll in terms of human suffering and casualties, major disruptions are being felt across the economic and social sectors in an already fragile world economy. The global economy is expected to experience its worst recession since the Great Depression, according to the International Monetary Fund (IMF). It has already contracted sharply by three per cent; surpassing the deep economic slump following the global financial crisis a decade ago.

The impacts on economy and society are already weighing in heavily on many sectors. Particularly, the industrial sector is struggling to meet the demands of consumers due to shortages of supplies for production. As a result of lockdowns and restricted movement of goods and people, key industries in many countries are closing and global supply chains are being disrupted. As in other countries, operating in the unknown creates a substantial risk for the industrial sector in Pakistan, including manufacturing and services industries. The decline in economic activity is disproportionately impacting SMEs. The Small and Medium Enterprises Development Authority (SMEDA) has issued the results of its online survey to assess “the impact of Covid-19 on SMEs.” According to this survey, 95 per cent of businesses reported that COVID-19 and the subsequent lockdown have caused a reduction in their operations. 92 per cent complained about disruptions in their supply chain and 23 per cent reported losses in their export orders.

To make matters worse, the containment measures implemented in advanced economies have started impacting less developed countries, including Pakistan, through decreased manufacturing production, trade volumes and investment flows. On the social side, COVID-19 has already exerted a far-reaching impact on Pakistan’s labour markets, as unemployment keeps rising. The crisis also threatens to push back the limited progress that has been made on gender equality and exacerbate the feminisation of poverty, vulnerability to violence, and women’s equal participation in the labour force.

As part of the United Nations System’s response to COVID-19, the United Nations Industrial Development Organisation (UNIDO), with its mandate of inclusive and sustainable industrial development, is working with other UN agencies in developing a comprehensive COVID-19 Socio-Economic Impact Assessment and Response Plan for Pakistan. Moreover, the UNIDO is conducting an industrial survey that will provide a rapid assessment of the impact of COVID-19 as well as possible remedies and policy recommendations for manufacturing firms to adjust to the “new normal.”

Besides, the UNIDO, under a global strategy to combat COVID-19, is assisting the Member States in addressing the crisis through urgently needed support along three dimensions: Prepare & Contain, Respond & Adapt and Recover & Transform.

Through the Prepare & Contain dimension, UNIDO is supporting Governments in mapping, designing and adopting quick and targeted measures to support those manufacturing sectors heavily affected by containment measures and shrinking demand to, thus, protect workers and jobs, particularly most vulnerable ones. Moreover, the SMEs are supported in diversifying production and in accessing critical supplies such as Personal Protective Equipment (PPEs) and life-saving equipment, necessary to maintain production and ensure the safety of workers.

COVID-19 has already exerted a far-reaching impact on Pakistan’s labour markets, as unemployment keeps rising

The Respond and Adapt Dimension entails measures aimed at supporting governments, the business sector, and in particular, the MSMEs operating along the value chains to assess the possibility of re-purposing manufacturing capacities towards the production of soft medical equipment. It also seeks to promote targeted solutions across several sectors to help respond to the crisis. In this process, the UNIDO is contributing to integrated service packages to promote inclusive and environmentally sustainable solutions for MSME; supporting them through continuous learning, virtual outreach and innovative solutions. Taking advantage of its multifaceted expertise, the UNIDO will also deploy its analytical capacities to help government identifying investment-conductive policies, successful finance recovery measures and resilient sectors to be prioritised in the aftermath of the crisis.

The Recovery and Transformation dimension focuses on supporting emerging sectors by prioritising industrial revitalisation and transformation through green, circular and low carbon solutions. At this stage, it is vital to re-engineer supply chains and markets and emphasise resilience and local/regional sourcing. This process involves revitalising MSMEs; ensuring resilience in the face of the economic crisis and their capacity to generate jobs for women and youth, by helping them accessing finance and expertise. Similarly, re-skilling workers and leveraging investments into digital infrastructure and innovative industrial solutions will be crucial for the Member States to benefit from the Fourth Industrial Revolution and respond effectively to an economic shock.

An effective response to the COVID-19 pandemic will not be possible unless affirmative policy actions, especially industrial policies, are put in place, to mitigate the impact of the crisis on the industrial sector, and to ensure inclusive and sustainable economic development during and after the crisis. Stimulus packages in the recovery phase offer a unique opportunity to transform the productive sector and foster long-term socioeconomic resilience by tackling health, climate and environmental challenges.

UNIDO is determined to continue assisting the Government of Pakistan during this difficult period together with its many partners around the world. In the words of UNIDO’s Director General: “In this time of crisis and as we work on the difficult recovery ahead, rest assured that we at UNIDO and the entire United Nations system stand with you today and tomorrow, and in the years to come. Together, we can build a global economy strong, resilient and flexible enough to counter future challenges, and strong enough to leave no one behind.”

The international community will only be able to weather the storm of this global health and economic crisis if everyone comes together. The call of the day is for more multilateralism and not less, and support to those that are worst affected.

The writer is UNIDO Country Representative in Pakistan