The
current global situation brought about by the pandemic is characterized as
volatile, uncertain, complex and ambiguous (VUCA). There is fear, panic and
uncertainty in face of an invisible enemy. The virus which started in Wuhan in
December 2019 has spread rapidly all over the world and has created an
unprecedented global crisis. It is not just a health crisis but an economic,
political and social crises.
Compared
to the last devastating pandemic - the 1918 Spanish flu -- the rate of infection
and fatality of COVID-19 is relatively low. But the reaction and impact are
unprecedented. Everything has shut down
– whole countries and states are on lockdown or quarantine. The damage and
changes that follow will depend on how long this pandemic last and the direction
those in leadership will make.
There
is uncertainty when the lockdown will completely be lifted and when the health
crisis be over. It could take years to contain and totally defeat this virus.
Like in the past, the virus with its various mutations will continue to be a
threat. A second or third wave cannot be
ruled out unless the vaccine and cure is found and made available. Thus, there
will be a gradual and calibrated lessening of the lock-down and community
quarantine. Social/physical distancing will have to be observed. Large
gatherings will be avoided. This could become the new normal.
We
are facing a great uncertainty. We cannot be sure what will happen next. This
is a global crisis. The longer this crisis persists, the worst the
repercussions and the more radical changes can be expected. We hope for the
best and prepare for the worst. Everybody hopes that the pandemic will end
soon. Even if the health crisis subsides
the global economic crisis will continue to exacerbate. The shutdown of the
economy has led to economic recession and could lead to a global economic
depression if the trend continues. Many companies and businesses are going
bankrupt and closing down. Millions have
lost their jobs and do not have enough to eat. According to IMF, 260 million
people are facing starvation especially in Africa, Latin America and Asia. Trillions
of dollars have been lost in the stock-market. The global neo-liberal
capitalist system is collapsing. There
is disruption of the global supply chain and less demand and consumption which
makes economic recovery difficult. The so-called V-shaped recovery where the
economy can quickly bounce back to normal has been ruled out.
Thus,
an economic crisis and a political crisis can be the consequence of the health
and humanitarian crisis. How governments and civil society respond to this
crisis will determine what kind of world will emerge. For better or for worst,
the political and economic crisis could lead to new economic and political
systems and configurations accompanied by cultural and social changes. As the
saying goes, a crisis is not only a time of danger – it is also a time of
opportunity. The greater and deeper the crisis, the greater the opportunity for
radical and long-lasting change. This is what happened in Europe after the
Black Death in the 14th century. This could happen once again in our
lifetime.
Times
like this requires strategic thinking and acting on the part of those in
leadership position in various institutions whether government, ecclesiastical,
religious, etc. This means looking at the big picture and the long view. One
the most important things that needs to be done is to assess the present
situation – the threats and opportunities, the strengths and weaknesses. Since
it is difficult to predict or forecast what will happen, building scenarios
could be helpful. These can be the basis for strategic directions and plans. No
planning can be done without going through this process. It is not enough to
dream of what kind of world we want to have after this pandemic. We also have
to look at what is happening and what could happen. This should be done at both
the global and local levels. This paper is an initial or preliminary attempt to
do this from a global perspective. Hopefully, this can spur further efforts to
understand the situation and the possibilities for the future.
Threats
and Weaknesses
The
coronavirus continues to spread all over the world as the number of cases and
fatalities increase. Even with an apparent containment and decreasing rates of
infection, a second and third wave cannot be ruled out unless a cure or vaccine
is found and made available.
The
situation worsens as many governments with inept leadership are incapable of
dealing effectively with the health crisis as well as the consequent economic
crisis. This paves the way for increasing authoritarian rule from the national
to the local levels. A virtual martial law is imposed to enforce the lock-down
or quarantine. Abuse of authority and violation of human rights are prevalent.
The
economic recession and possible depression can result in the breakdown or
collapse of neo-liberal globalized capitalist economic system. De-globalization
is underway. The disruption of supply-chain and the slow-down or stoppage of production
as well as the decline of consumption and demand makes it difficult to recover.
This leads to bankruptcy, shut-down of businesses, rise of unemployment,
increasing poverty, and food scarcity. The pandemic manifests the widening gap
between the haves and the have-nots.
The
developing economies in Latin American, Asia and Africa will suffer the most
even if the rate of infection and fatality is lower than the developed
countries. East Africa is facing not just the pandemic but also the locust
plague. Europe which has been on a
long-term recession before the pandemic is not spared from the economic crisis.
Italy, Spain, France and Great Britain are being hit hard. While the German
economy appears to be stable it cannot be sustained in the long run since it is
50% export-oriented. The collapse of the oil industry is affecting not just
Saudi Arabia, Iran and Russia but also Nigeria and Venezuela. China, which is
touted as the second largest economy is not spared from the economic crisis as
production slows down and the demand for its products decline. With capital
flight, rising unemployment, and inability to take care of a billion citizens
who remain poor the ruling Communist Party tries to tighten its hold on power
as anti-China sentiments spread globally.
All
over the world, there is growing apathy and feeling of helplessness and
hopelessness of so many people, on one hand and a growing anger and social
unrest especially from the lower class on the other.
The
ecological crisis continues and more zoonotic viral diseases (e.g. the
coronavirus which has been traced to bats and pangolins) are expected to appear
due to the continuing destruction of the eco-systems and the wildlife-human
contact.
The
realization of the lethal impact of viruses can lead to their development and
future utilization as biological weapon more destructive than nuclear arms. If
this comes to the hands of rogue states like North Korea and extremist groups
like ISIS and Al-Qaeda could make use of this.
There
is an absence of a coordinated, global response to the health and economic crises.
The United States which has the status of the sole global superpower maintains
an isolationist (America-first) stance, unwilling to exercise leadership at the
global stage. It sees NATO as irrelevant after the dissolution of Soviet Union
and is only interested in keeping the threat of Russian expansion in check by
propping up Ukraine and Poland economically and militarily. The European Union
fails to maintain a united approach to the crisis leaving each nation-state to
fend for itself and resurrecting national borders. G7 is history and G20 does
not function. The United Nations, the Security Council and the World Health
Organizations cannot address the crisis and thus the absence of international
coordination and solidarity. The dream of an interconnected global political
and economic order is threatened by fragmentation and the resurgence of
nationalism and protectionism.
A
spiritual crisis could accompany the health, economic and political crisis. As
people make sense of the tragedy and grieve over the countless suffering, death
and devastation of the pandemic, theological questions will emerge: Where is
God in all of this? How could God allow this to happen? Is this God’s
punishment? Does God really answer our prayers?
Opportunities
and Strengths
Several
countries in the European Union led by Germany has pledged to raise $8 billion
for the development and distribution of vaccines.
Each
nation-states/government are acting to contain the spread of the virus and
address the immediate needs of the people and the economy (e.g. release of
state funds, aid, stimulus rescue package, etc.). Inept and authoritarian
political leaders and systems responsible for the spread of the virus are
unmasked and will be held accountable. Effective
and democratic leaders and political systems are emerging. Countries like
Taiwan and Sweden are successful in containing the virus without draconian
measures and resorting to authoritarian rule. In the long run, the citizens
will be more discerning in choosing competent and compassionate servant leaders
with clear strategy for addressing crisis that society face (health, economic,
ecological, etc).
Church
and civil society groups are mobilized to give aid to the poor who are mostly
affected and to front-liners. This crisis in bringing out compassionate
response. Big business corporations are engaged in charitable contribution. International Financial Institutions like Asian
Development Bank, World Bank and IMF have expressed willingness to write off
debts of developing countries.
There
is maximization the use of digital communication and information technology
(remote work, online meetings, online masses, etc.). The
digital-based commerce and industry survives and thrives. This can lead to the
acceleration of the 4th industrial revolution.
The
UN and the pope’s global appeal for ceasefire has been heeded in some areas as
warring parties are unable to carry out offensive in places where the virus has
spread.
There
is less GHG emission due to the shut-down of factories and less use of vehicles
– a temporary reprieve for global warming with less demand for fossil fuel and
the collapse of the oil industry.
Since
the situation is volatile, uncertain, complex and ambiguous, it is very
difficult to forecast what is going to happen in a post-pandemic world. It is
better to build scenarios which may or may not happen. Seeing worst-case and
best-case scenarios can be helpful in helping develop flexible strategies and
responses.
Scenario
1: Short-term Pandemic followed by Rapid Recovery
The
pandemic ends before the new year 2021, with the rapid discovery and production
of vaccines as well as coming up with effective cures. The cases and fatality
rates are kept to a minimum. The lock-down and quarantine is lifted all over
the world. There is a short-term economic recession and a U-shaped economic
recovery is on the way by the first or 2nd quarter of 2021 due to successful
government-led recovery program. Full economic recovery is achieved in three
years.
There
is rapid growth of digital-based commerce, communication, etc. (Amazon, Zoom,
etc). China’s status as global hub of manufacturing is reduced as anti-China
sentiments grow with effort to hold it accountable for the spread of the
coronavirus. The process of decentralization of supply chain starts with the
withdrawal factories and investments from China and transfer to Vietnam,
Thailand, Philippines, India and Mexico.
The
transfer of the manufacturing hub to Mexico is beneficial to North America and
prevents future disruption of the supply chain.
The
election of a new US president who is more competent and compassionate can pave
the way for the US to exercise global leadership in coordinated international
response to the health and economic crisis. This will benefit the developing
countries and preserve stability in the various regions.
Tensions
arise as China continues to expand and consolidate its influence in the South-China
Sea by ongoing military build-up in the disputed islands. However, it is unable
to attain regional hegemony as it fails to fully recover economically.
The
release of GHG as fossil-fuelled industries and vehicles goes back to normal
and even doubled to make up for loses. Climate change and ecological crisis
continues as the governments are unable implement the Paris agreement regarding
the reduction of GHG emission.
With
the containment and disappearance of the virus, the authoritarian/totalitarian
control is eased in many countries while it remaining entrenched in other
countries.
Scenario
2: Long-Term Pandemic (Economic-Political Depression)
The
pandemic continues to spread, no effective cure and vaccines have been
discovered and developed. The virus keeps coming in waves for several years,
number of cases and fatalities continue to rise. The pandemic continues to be a
threat for the next 4 to ten years or even longer with intermittent quarantine
or lock-down and disruption of economic activities. More zoonotic pandemics are
expected due to the destruction of eco-systems.
The
global recession turns into economic depression. Bankruptcy, unemployment,
growing poverty and widespread hunger. Collapse of various the following
industries: oil, airline, tourism, hotel, restaurants, malls, small-business.
Economic depression is accompanied by political depression as US is unwilling
and unable to exercise global leadership and the major powers fail to get their
act together. The European Union fails to address the economic crisis
collectively and European unity unravels as each nation-state assert
self-determination. Italy, Spain and France are hard hit by the depression with
the ranks of the unemployed and poor grows. Germany’s economy is heavily
affected as the lack of demand and consumption from its European neighbors
weaken its export-oriented economy.
Russia
continues to decline due to the collapse of the oil industry, ongoing
corruption and aging population. Tensions in the South China Sea continues as
China asserts its dominance and hegemony in the region and US Naval forces
conduct freedom of navigation exercises. This could trigger skirmishes with
neighboring countries (e.g. Japan, Vietnam and Indonesia) or war if China try
to occupy Taiwan. At the same time, power struggle erupts within Chinese Communist
Party due to ineptitude of preventing the pandemic as various countries strive
to hold China accountable. China loses its role as the global manufacturing hub
and fails to recover economically as US, Europe, Japan and other countries
distance themselves and isolate China. Dissent and social unrest grow that
threaten the collapse of Chinese autocratic regime and the consequent
fragmentation into regions. China’s aging population, inequality, and
export-oriented economy prevents it from attaining its ambition to be a
superpower.
Justifying
the continuing threat of the virus, authoritarian and totalitarian regimes all
over the world continue to rise and consolidate to enforce social order.
Surveillance and control of all aspects of life is maintained. Human rights and
civil rights – including religious rights – are violated to justify the defence
of the populace against the virus. The spiral of violence continues as
resistance grows. This can lead to rebellions and civil disobedience as the
government fails to address the health as well as the economic crisis and
starvation effectively.
Greater
government intervention can lead to either a fascist/state capitalist model or
a social-democratic model. Inept authoritarian regimes fail to address the
multiple-crisis and collapses. This can lead to the emergence of more
competent, compassionate leaders and political systems.
Meanwhile,
there is acceleration of the 4th industrial revolution (digital-based economy,
e-commerce, 3-D printing, local manufacturing, remote work, etc.). New normal:
online-education, meetings, conferences.
The
long-term threat of the pandemic and intermittent lockdown and lessened GHG
emission gives a chance for the environment to rest, slowing down climate
change. There is change in lifestyle and patterns of consumption due to frugal
living.
Scenario
3: Utopian/Best-Case Scenario: Emergence of a New World
The
pandemic and its long-term impact accelerate the collapse of the global
neo-liberal capitalist economic order. Vaccines and effective cure to the virus
are produced and distributed world-wide. A new multi-polar political-economic order
capable of responding to the pandemic and ecological crises emerges. As the
de-globalization of the economic system continues, new forms of
interconnections and international cooperation emerges. No nation exercises
global hegemony, each one focusing its primary efforts in rebuilding its
economic-political and social institutions and systems. Developed nations who
are first to recover from the crisis provide humanitarian and economic aid to
less fortunate nations who are hard hit.
Nation-states adopt a system of mixed-economy
accompanied by strong government intervention to promote social justice
following the social democratic model. Incompetent
and corrupt politicians who have been unmasked during the crisis are replaced
by new leaders who are more competent and who are more concerned about the
common good. There is state intervention to jump-start the economy, address
poverty and hunger, and ensure universal health-care, food security, creation
of new jobs with job-security, support for small-scale industries, actively engaged
in planning for rebuilding the economy and redistribution of wealth.
With the break-down of the supply-chain
dependent on China as manufacturing hub of the global neo-capitalist economic
system, nationalist and self-sufficient policies are adopted. The acceleration
of the 4th industrial revolution with the development of 5G,
robotics, 3-D printing, enhanced digital communication and e-commerce radically
change the economic system. There will be no need for off-shore manufacturing
hubs and centralized/ distant supply chains. Domestic manufacturing for local
markets and consumption will flourish. Decentralized, small-scale,
community-based industries will be promoted.
Universal health-care system will be instituted. The economy will be
geared towards preparation for the next pandemic crisis as well as the
ecological crisis. Instead of a
centralized, globalized economic system, it will be an interconnected,
net-worked based system using latest digital information and communication
technology brought about by the 4th industrial revolution.
The
oil industry which has collapsed during the pandemic fails to recover fully
with the lessened demand for fossil-fuels and rapid development of renewable
sources of energy and new methods of manufacturing. This means that large scale
distribution of energy is replaced by new community-based power grid.
An economy of communion will be promoted concerned
not only with growth and profits but also sharing with one another and with the
poor and the needy.
As
physical distancing and avoidance of large gathering become the new norm, new
patterns of social interaction develop (local/small communities, online/virtual
communities).
What
I have attempted to do in this paper is to provide an initial assessment of the
global situation and prospects for the future based on my research, monitoring
the news and scouring YouTube Webinars and interviews by experts during the
lock-down. This is by no means exhaustive will continue to be developed and
deepened. Making an ongoing assessment of the global and local situation is the
task of every institution including the Church and religious institutes at
various levels. This as the basis for setting strategic directions and plans.
Background Readings:
Frank Snowden, Epidemics and
Society, Yale University Press: London, 2019
Joshua Loomis, Epidemics: Impact
of Germs & Their Power over Humanity, ABC-CLIO: CA, 2018
Joshua Gans, Economics in the
Age of Covid-19, MIT Press: London, 2020
George Friedman, Flashpoints:
The Emerging Crisi in Europe, Anchor: New York, 206
George Friedman, The Next 100
Years: A Forecast for the 21st Century, Doubleday: NY,
Ian Bremmer, Every Nation for
Itself: Winners and Losers in a G-Zero World, Penguin: NY 2012
Peter Zeihan, DisUnited Nations:The
Scramble for Power in an Ungoverned World
George Magnus, Red Flags: Why
Xi’s China is in Jeopardy,
Klaus Schwab, The Fourth
Industrial Revolution, World Economic Forum: Geneva, 2016
Christiana Figueres et al., The
Future We Choose: Surviving the Climate Crisis, Knopf: NY, 2020
Luigino Bruni (ed). The Economy
of Communion, New City Press: NY, 2002
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