By Clem Sunter
Clem has written an interesting article on some of the scenarios facing us as we try and plan for the future. I have summarized below, the full article appears in:
The latest coronavirus scenarios: walking the tightrope
At the beginning of March this year, I wrote an article painting three coronavirus scenarios for the world at large over the foreseeable future: “Much Ado About Nothing”, “The Camel’s Straw” and “Spain Again”.
At the time, the number of global infections caused by the virus was 100 000 and deaths 3 000. Today the respective figures are 2 400 000 and 165 000.
So, looking towards the remainder of this year and into the next one, which scenario is likely to play out in reality? In answering this question, I will add one further scenario which I call “Tightrope”. As you will see, it is a challenging alternative but these are unprecedented times.
Much Ado About Nothing
All the medical flags which have gone up over the last month indicate that this scenario can almost certainly be discarded as a way of interpreting the past and the future of the pandemic.
The rise in the number of deaths by a factor of 55 in such a short period, and the fact that the public health systems of some of the richest nations on Earth have been completely overwhelmed, indicate the sheer scale and suddenness of the current disease.
To suggest that it is just another form of seasonal flu or that, left to itself, it will disappear like the outbreak of SARS and MERS before doing too much damage to humanity seems bizarre.
The Camel’s Straw
We move on to The Camel’s Straw scenario. In it the coronavirus does not have to kill millions of people to be the straw that breaks the camel’s back.
The global economy was already vulnerable before the pandemic began, with slower economic growth in China and the ongoing trade spat between the two biggest economies in the world, America and China. All that was required, therefore, was a small disruption to make the global economy collapse like it did in the Great Depression of the 1930s.
In terms of disruption, reality so far has been far more shocking. Witness the scenes of major cities with deserted streets; small businesses, restaurants and shops reliant on daily cash flows being completely closed down; operations of large businesses put on care and maintenance; no sports events or other mass gatherings; empty churches, schools and universities; multiple deaths in old age homes hit by the virus; and no international travel and tourism.
If I had posed this scenario in November last year, nobody would have believed it because it was unimaginable.
The third scenario of a repeat of the Spanish flu of the last century, which killed 3 to 5% of the world’s population, will remain in play until a vaccine is found. As already indicated, the coronavirus is unlikely just to melt away even with prolonged restrictions on human movement.
With the world’s greatest experts focused on discovering a vaccine and proving it in a series of trials, the time to get it on the market is thought to be a year to eighteen months. Until then, the nightmare scenario of a runaway pandemic should serve as a warning to all those leaders and policy makers who want to dismantle the current measures of containment too soon.
My closing advice at the end of my previous article was that humankind must become more cooperative to ensure that the virus did not have the last word. We needed to create the feeling of a shared destiny on this planet.
Alas, despite some wonderful examples of international assistance with critical items of medical equipment being sent to places where they are most needed, we still live in a world of enclaves, rising nationalism and leaders pursuing their own agenda.
If anything, the virus has fueled an even greater desire by countries to become more inward-looking and self-sufficient. Yet, the only way out of the mess is a shared strategy to rid the world of an enemy that knows no borders. Every nation has to learn from each other.
Hence, I am introducing the Tightrope scenario which is all about a delicate balancing act between preserving lives and livelihoods. The most important decision for any country to make is when and how to lift the restrictions in place by balancing the best medical models on the potential evolution of the pandemic against the need to revive the economy.
This is not easy to do. Implementation has to be a step-by-step process; and there will be wobbles along the way.
Furthermore, given that the spread of the virus has been uneven, different parts of a country may need different approaches and time lines. One shoe does not fit all and any sign of resurgent clusters must be nipped in the bud with swift testing and fresh quarantine measures if necessary. The elderly may need special protection too.
As life begins to attain a new normal – it will never return to the old one – it will be up to businesses, families and individuals to walk the same tightrope in their daily activities. Judgements on what constitutes sensible social distancing measures will be at the heart of everything we do until an effective vaccine is discovered and universally distributed.
There is a growing consensus among governments around the world that the acrobatic journey described in the fourth scenario should begin as soon as is reasonably possible. China, Austria and Denmark have already ventured forth on the rope. New Zealand will start next week and others will follow later in the year.
Will we thus avoid the pitfalls of slipping into The Camel’s Straw and Spain Again scenarios on either side of the rope? I sincerely hope so but these are early days. We have plenty of surprises in store. But of one thing you can be sure: adaptation is the key to survival.
20 April 2020