Prevent a COVID-19 resurgence

Thursday, 22 April 2021 00:50 - - {{hitsCtrl.values.hits}}

The writing on the wall was clear. Health officials had warned repeatedly that despite the roll out of the vaccine it was imperative for PCR tests and other social distancing guidelines to be continued. Unfortunately, there was no extra effort put to combat complacency that had set in and the New Year created the right environment for COVID-19 to raise its head again.

A rise in numbers is all the more worrying given the devastation taking place in India. The unfolding deep human tragedy, where hospitals have long run out of beds and people are sourcing oxygen on social media and a journalist live tweeted till his death has shocked the world. It is a stark reminder that the pandemic is far from over and complacency can come at colossal cost. The Modi Government is seen at best as incompetent and at worst as wilfully insensitive and uncaring. It could well be that the human cost is followed by a political one.

Back in Sri Lanka, officials have been scrambling to rejuvenate systems that had been painstakingly put in place over many months. This is perhaps the real casualty of complacency; that good work is allowed to disintegrate and more resources are needed to put things back the way they were. At a time when countries around the world are struggling to keep new variants in check while allowing their economies to function, these are lapses that can come at very high cost.

For Sri Lanka, the costs could be higher than most, as ground conditions were improving since January. Indicating a strong revival in manufacturing activities in the country, the manufacturing Purchasing Managers Index (PMI) released by the Central Bank reached a nine-month high of 67 in March. This was largely attributable to the increases observed in Production, New Orders, and Stock of Purchases sub-indices. The same index also tracked an increase in the services PMI for the fourth consecutive month, showing how economic activities have improved since the second wave was brought under control.

These were serious positives in Sri Lanka’s efforts to deal with the pandemic and any possibility they could be rolled back is alarming to consider. Things are precarious enough economically without having to worry about a third wave. The rupee has increasingly come under pressure and increased in volatility as the days inch closer to Sri Lanka’s repayment of a $1 billion sovereign bond in July. Reserves have fallen to historic lows and while they were recently boosted with a $ 500 million dollar loan from the China Development Bank (CDB), it is likely to be utilised to repay $ 720 million in the first week of May.

The Government is in talks with Bangladesh and undertook visits to Oman and Qatar to drum up forex injections but these measures are still not finalised, making the way forward murky. Many currency traders appear unable or unwilling to predict the future of the rupee. This situation, together with larger macroeconomic issues and Sri Lanka’s long-standing struggles to reform the economy, causes concern about growth sustainability.

The priority of the Government should be to stringently enforce COVID-19 health guidelines and do everything possible to prevent a third wave. It is the national need of the hour.