The effect of Corona Virus in the economy

The effect of Corona Virus in the economy

The effect of Corona Virus in the economy

At the end of last year, the Chinese city of Wuhan first mentioned an unknown virus that is believed to have been responsible for a number of lung diseases. Covid-19 is now keeping the whole world in suspense.

As of April 24, 2020, there were a total of 2,626,321 confirmed infections worldwide. The virus has already claimed more than 180,000 deaths. With over 150,000 people infected, Germany is one of the most severely affected countries, but Austria and Switzerland are also struggling with the effects of the coronavirus.

This is not only felt by the health systems that need to be protected from overload. The economy and the financial markets also suffer from the consequences. Where will it all lead and how can companies prepare for the now inevitable recession? We give an overview of the current situation and dare to look forward to what is in store for us.

The corona crisis hit the economy hard and severely affected it. After the serious slump in the first half of 2020, the economy has so far been able to cope with the consequences of the pandemic better than expected. But increasing numbers of infections and possible new lockdowns make the economy look to the winter of 2021/22 with concern.

How the virus crisis has so far affected the economy, what causes the crisis in general, what consequences it has led worldwide, and how attempts are being made to counteract with appropriate measures - that is what this article is about.

Corona protective measures paralyze public life

To protect against the rapid spread of the virus, in all countries around the globe, sometimes drastic protective measures have been adopted, which massively restrict citizens in their freedom of movement and decision-making.

Austria is proceeding particularly consistently. It was decided to impose exit restrictions that only allowed citizens to leave the house for urgent errands or exercise in the fresh air. But in Germany and Switzerland, too, the decision was made to largely paralyze public life in order to protect against infection. Cultural and leisure facilities, schools, daycare centers and universities as well as numerous shops that do not serve to cover daily needs were closed.

 

The world implemented the first easing on April 14th. Shops with a maximum sales area of ​​400 m2 were allowed to reopen, subject to strict protective measures. Some countries followed on April 20 and Switzerland on April 27. In Switzerland, hairdressing salons and massage studios have even been allowed to reopen. Meanwhile, restaurants, bars and clubs have to be patient. But all other industries are also struggling with problems such as short-time work, a drop in orders and non-payments. It is obvious that many now fear for their existence. The entire global economy will not be spared the consequences of Covid-19. Some politicians are already saying that we are facing the worst crisis since the Second World War.

The ways Covid 19 has affected the economy

No one could ever have imagined the economic and social upheaval that the Coronavirus pandemic has caused for an entire generation. Probably the tsunami that the virus has dragged behind will engrave a deep mark inside each person for years to come or perhaps forever.

The whole world economy will no longer be the same, in the balance of power, in habits, in consumption.

A few days after the end of 2021 and all that this has meant for the daily flow of our lives, with this article we have identified the ways covid 19 has affected the economy. Let's see them and try to understand how they can impact the present and the future of the world economy.

Governments spared no expense

Public debt is no longer the priority of governments. Or rather, in a dying global economy, fiscal policy finds more space in public spending than in the past, where inflation poses no threat. This year the total deficit amounts to 11 trillion dollars and all the conditions are in place for the figure to increase considerably in the coming years.

Ease of getting money

There is now a trend for central banks to make money rain down on people all the time. People in every country have been stepping up their Monetary Stimulus by keeping interest rates low, both to keep public debt from growing and to get the economy back on track, When there isn't a long-term recovery in employment, it's hard for monetary policy to change, and it's been proven that low interest rates stay low for a long time after a pandemic.

The development of dead businesses

Governments have given money to businesses that have been killed by shutdowns and restrictions. This has led to a huge amount of corporate debt that reached 3.360 billion dollars in the first half of 2020. This is a big problem for a company's ability to pay its debts, especially in a time when some businesses have seen their profits fall dramatically. The result is that living dead businesses have been made, which means that they live as long as they get help from the government, which is like giving them air.

The crisis of emerging countries

The poorest countries are in a state of emergency because of the rapid growth of debt, the new mass of poverty, and the currency crisis, which leads to capital flight. The World Bank and IMF sounded the alarm. Richer countries that owed money took some steps to make debt easier to deal with. As you can see, that isn't going to be enough without the help of private investors.

Series A and Series B workers

Employment discrimination has been caused by Covid-19. The poorest people who work in the real world have had to pay for the drain caused by the economic crisis, especially in some fields. It used to be that only the richest people were interested in these kinds of things, but now they're back in style. Women were especially hard hit because, in addition to working in sectors that were in trouble, they had to help children because schools were closed.

Automation will generate unemployment

To stay at home, machines have been made that can check in guests at hotels, collect taxes at traffic lights, and cut salads for restaurants because people want to stay home. Not to mention, of course, that online shopping really took off during the pandemic. All of this has been good because you needed it, but when you can go back to work, you don't need to have people around.

Smartworking is a risk for real estate

In many cases, people will be able to work from home for a long time in 2021. The pandemic, on the other hand, left a permanent mark in the corporate reorganization of work because of this. Companies have changed how they support their employees because of new technology. This means that commercial properties could face a violent backlash in the next few years, which could be good for residential ones, though.

The travel industry in shock

Travel will never be the same again. That global tourism has dropped by 72% this year is a bad sign, but it also means that as soon as you can travel safely, the holidays will start again and the situation will go back to normal. As for business trips, things are very different. Many businesses have held online meetings, and this could be a stunt with no way back. This would hurt the travel industry, and this would be bad for businesses.

Productive removals inaugurate a new globalization

Many businesses have had to move their production this year because of the spread of infections in different parts of the country this year. All of this has led to a new kind of globalization that is tempered by necessity. The new structure of production could also make the reorganization last, making it more stable. Industrial production has also changed because of the pandemic. Faceplates have been made by companies like FCA to fill the void left by the decline in the car market.

The green turning point

Maybe this is the most important change. A lot less people used fuel this year, so it was thought that the oil age was coming to an end. So governments around the world have come to the conclusion that the time has come to make a big change to the way the world works. In the near future, a green economy will be the world's main source of income.

The best leisure activities in covid-19 times; what to do in covid 19

In addition to doing school or work tasks, we now also spend our free time at home. That can get really boring. Fortunately, we have the best leisure activities ready for you in COVID-19 times.

Video calls

Not only is it good for you to stay in touch with your friends, it is distracting and time simply goes by faster. Eating, chatting or taking a break from homeschooling together.

 

Play games

When you've talked or chatted enough, why not play something together! When was the last time you played a classic board game with your family? Time to do it all over again.

 

Do you want to test your knowledge? Then hold a pub quiz!

You can get together online and have a question and answer session with friends or family on very special topics. The great thing is that you can create it yourself and there are no limits to creativity. Simply ask questions that are answered or share a professional presentation on the screen with film sequences, audio samples, quotes or images that need to be recognized.

Mucking out

Good for the soul! You can finally say goodbye to old parts and bring order to your closets. Environmentally friendly tip: Don't throw away the old things, donate or sell them online (as soon as we have the green light to go out again), or make something new out of them.

 

Handcraft

Do you have time and your walls in the room are empty, or you need a new organizer for your desk? There are many ideas and possibilities and often you don't even need a lot of new material, but everyday things that you would otherwise throw away - just upcycling! Just enter what you want to make in your search engine and let yourself be inspired!

 

Sports

The swimming pools, sports fields and clubs are closed. This is the opportunity to try something new! Enter “workout at home” on YouTube and do fitness even without equipment, just with your own body weight. Do you have a garden? Then do a parkour for circuit training. You can also try to hit a ball from the furthest possible distance into a vessel ... It's kind of sport too.

Doing sports alone is not for you? No problem, you can just meet online and do sports together.

 

Write a diary / blog

It is a completely new situation for the whole world - almost material to write a book. Take some time every day and report on your life in quarantine. How are you? Is the ceiling falling on your head yet? Do you have time to sleep in? Whether online or just for yourself in your own notebook, after this time it is exciting to read what thoughts you had back then.

Cook

You finally have time to cook all the dishes and arrange them as beautifully as you know them from Instagram. If you don't have all the ingredients at home and still go shopping: only buy what you really need!

 

Puzzle

Old but tried and tested. Puzzles kills time and lets you relax. Besides, you have to think about why the green part does not fit together with the other green part.

 

Approach a long-cherished project idea

Have you wanted to implement a cultural or art project for a long time? Do you have an idea for a climate protection and environmental project? Then now is the right time to start planning your project.

Team charity

Do you want to do something useful for someone else? Then take a look at the Caritas website. Especially in times of Corona there are many people around you who can need your help, be it running errands or just talking to someone!

 

Youth centers

If you are bored or you need someone to talk to - ask at your youth center / youth club. Even if you cannot be there at the moment, you can take part in exciting offers virtually.

 

Conclusion

With relief from the epidemic hauntingly near in many locations but far from reach in others, policy decisions will be vital. Securing fair vaccination distribution will be vital to stopping the epidemic.

Far-reaching debt reduction will be vital to many low-income nations. Policymakers will need to foster the economic recovery with fiscal and monetary measures while keeping a careful eye on maintaining financial stability. Policies should take the long view, reinvigorating human capital, improving access to digital connections, and investing in green infrastructure to support development along a green, resilient, and inclusive route.

It will need global cooperation to terminate the epidemic via universal immunization and prudent macroeconomic management to avert crises until we get there.


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