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How the Pandemic has Affected the Economy

The economy is one aspect of life that is highly dynamic; it can easily be affected by destabilizations varying from how people interact to different policies enacted by governments. When the World Health Organization declared coronavirus a global health disaster, it was evident that businesses would no longer be conducted as usual. Many things changed, such as importation, employment, production, among other functions that sustain and grow the economy. The emergence of the COVID-19 pandemic has had a critical implication on the world economy. This essay discusses some of the effects the pandemic has had on the economy.

First, the pandemic led to reduced international trade. The declaration of COVID-19 as an international disaster implied that nations had to put measures to protect their citizens. In this case, people and goods could no longer move across different nations freely. Implementation of the travel ban affected how people do business. Additionally, goods were limited from moving from one country to another due to increased scrutiny that had to be implemented to reduce the international transmission of coronavirus. Imports and exports are a measure of the balance of payment for any country; when these two business attributes are varied, the national and international economy is significantly affected.

Second, the pandemic brought about unemployment, which affected consumerism. Without jobs, people do not have the disposable income to acquire goods and services from the market. One of the factors that lead to job losses is the restriction of movement, mainly during the first 5 months after coronavirus was declared a pandemic. People from different parts of the world could not move to work, and many could not access markets. This problem extends to affect sellers in foreign markets. Lack of purchasing power among...