April 16, 2020

US catty and splenetic behavior is detrimental to global cooperation

By: Azhar Azam

*This is one of my opinion pieces (unedited) that first appeared at "China Global Television Network (CGTN)":
https://news.cgtn.com/news/2020-04-14/U-S-catty-and-splenetic-behavior-detrimental-to-global-cooperation-PG2Ca0CcA8/index.html

The Covid-19 is such an enormous threat to the mankind and global economy that it obliges all rivals to shelve the rivalries, all nationalists to forego nationalism and all the protectionists to suspend the protectionism at least temporarily and embrace a stronger, unvarying international cooperation for the protection of their citizens and economies.

Despite populist backlash from some Western quarters, it is still an era of breakneck globalization that has lifted the living standards of millions of people. While the phenomenon continues to connect people and make them dependent on each other for their economic and technological growth through multifaceted cooperation, it also prevents some aggressive and dominance-seeking countries to assert their hegemony or impose the totalitarian decisions on other sovereign nations.

The global cooperation, by pooling the wisdoms and sharing the experiences, is therefore the one-stop solution for international community to put forward a concerted and determined international response – in an open and transparent manner through mutual understanding, trust and support – to the novel coronavirus outbreak.

A report titled “Strengthening multi-level cooperation to fight the pandemic” published by the Center for China and Globalization (CCG) noted as the Covid-19 transforms into a global crisis affecting virtually every country, its impact on public health would have far-reaching implications ranging from individual livelihoods to political and economic structures.

It summarized China’s experiences – from implementation of the orthodox coordinating, mobilizing and communicating techniques to introduction of inventive big data, mobile apps and artificial intelligence applications – to control the disease and provided valuable suggestions on global cooperation to fight the virus and its economic fallout.

Of course, the objective of sharing Beijing’s experiences was not to urge global nations to follow Chinese method of handling the disease but to help them better understand how it fought and defeated the virus, enabling governments better analyze and contrive an effective Covid-19 strategy in accordance with their legal and political backgrounds.

Based on its findings, the report lined up a series of recommendations including activating multilateral platforms such as G-20; supporting the World Health Organization (WHO), allowing it to play a greater role in global cooperation and establishing a governance mechanism for international coordination on public health measures; and protecting global value, supply and industrial chains.

Recommendations also urged China and the US to strengthen dialogue and reach consensus on trade in medical supplies, support the World Trade Organization (WTO) to play an effective role in responding to the epidemic by promoting trade facilitation for emergency goods and cooperation across supply chains and support multinational cooperation on drug and vaccine development.

Although the US President Donald Trump lately scorched WHO labeling the international health body “Chinese centric” and accused it for giving “faulty recommendation” and is again threatening to withdraw from WTO over losing “so many cases” – the role of both the institutions is crucial in protecting the human lives initially from the pandemic and then from the economic consequences in post-coronavirus world.

While Trump’s criticism on the WTO is a blunt effort to influence the organization and coerce its appellate tribunal to resolve cases in the US favor – his disapproval of the WHO and the accusations on China for camouflaging the numbers by some other US officials, lack both evidence and prudence.

In an interview, the Republican Senator Rick Scott claimed that the American public will want to boycott Chinese goods after the pandemic as they “clearly killed Americans with their actions.” In his prior article, he called for congressional investigation into the WHO for serving “as a puppet to for the Chinese Communist Party.”

The US officials’ reproof on China and the WHO is detrimental to global cooperation in defeating the Covid-19. They are overtly trying to politicize the outbreak by deliberately overlooking the fact that China so far is the only country that has effectively controlled the pandemic and prevented its resurgence albeit being terrifically gripped by the virus.

Since the start of the outbreak, the WHO too has worked hard by supporting the countries to build their capacity to prepare and respond, has provided accurate information and fought the “infodemic” through issuance of technical guidance, arranged training and mobilization of the health workers, accelerated research and development and is ensuring the critical supplies to reach the frontline health workers.

Former Jennings Randolph fellow at The United States Institute of Peace (USIP) and professor of political science at Georgia State University Dr. William Long acknowledged “China, for its part, gave more timely notice of the outbreak” and the WHO too “made a timely finding” of the disease. He also believed that the spread of the infectious diseases can foster opportunities for international cooperation.

But Washington’s ostensible belief that it is the so-called custodian of the world and thus has the right to dominate all the countries and international organizations is the real hitch in the fruition of the global cooperation. Though the Trump administration has long been wary of trade deficit with China, it now seeks Beijing to direct all the medical supplies to Washington.

The attitude shows that for the US, the life and health of its people is important than those who live in Africa, Asia and even Europe. But for China, it tantamount to racism and the protection of people across the world was equally vital. Chinese donation of medical items, which to date reached to a total of 127 countries and four international organizations, emphasizes its uniform approach to shield all the nationalities without any favoritism.

In addition to this, the cooperation between China and world during the pandemic including the deployment of 13 medical teams to 11 countries and the commercial procurement of RMB 10.2 billion of anti-epidemic supplies by 58 countries and regions, spelled out the importance of global cooperation and the utility of globalization.

While some US politicians, governors and congressmen cried out about acute shortage of personal protective equipment (PPE) for doctors and nurses, it is imperative to know that China’s industrial capacity has already exceeded the pre-pandemic production of manufacturing 200 million masks daily. This imbalance in demand and supply can only be achieved through bilateral cooperation.

By the way, it is the US tariffs on the Chinese masks, gloves, goggles and thermometers that hampered the healthcare industry in China. The people and politicians in the US should first question the Trump administration – which still maintains tariffs of about $360 billion on all Chinese goods, slightly lower than the prior $400 billion – as why it ignited a trade war that earlier directly impacted the US farmers and importers and now indirectly is overawing the American people.

The scale and unforeseen consequences of the Covid-19 can only be contained through altruism and global cooperation among all nations and international institutions however the cause as big as the coronavirus necessitates the US to abandon its catty and splenetic behavior toward China.

April 15, 2020

US economy poised to make a hard landing

By: Azhar Azam

*This is one of my opinion pieces (unedited) that first appeared at "China Global Television Network (CGTN)":
https://news.cgtn.com/news/2020-04-11/U-S-economy-poised-to-make-a-hard-landing-PB8Cvcac7e/index.html

Due to the catastrophic fallouts of the Covid-19, the credence and state of the US economy is shaking ominously and it has lost the confidence of its businessmen. A survey by The Conference Board revealed that more than 80% of the America CEOs said that their business has been or will be substantially impacted by the coronavirus pandemic.

The US President Donald Trump wants to reopen the economy with a “big bang” once the death toll from the disease plummets. But the pessimism among the US chief executives, which has declined to the levels of the Great Recession with half of the executives seeing economy and industry to recover in no earlier than six months, poses a stark challenge to his post-virus ambitions.

While a whopping 97% of the executives as of early April, as compared to 70% for the month earlier, believed that the US economic conditions had deteriorated and were significantly worse than six months ago – the plans by over 54% of them to layoff or furlough the workers or slash the wages, salaries or benefits tells of their suspicion about quick restoration of the US economy.

The White House economic adviser Larry Kudlow on Thursday claimed that “100 percent immediate expensing across the board” could temp the US companies back from China. Nevertheless if the anxieties among the domestic entrepreneurs continued to intensify, it could instead heave more American firms out of the country.

On March 31, the other closely watched review by the member-driven think tank about consumer sentiment showed that worried Americans were worried about the US economy and how their personal finances will fare. The Index dropped 12.6 to 120.0 in March versus a month earlier – its lowest level since June 2017.

The plunge in the consumer trust wasn’t a temporary shock – rather was “in line with a severe contraction” and further “declines are sure to follow,” said Lynn Franco Senior Director of Economic Indicators at The Conference Board about the preliminary results the cutoff date of which was March 19.

Looking at the numbers, it is quite clear that the American businessmen and people didn’t had a great faith on their country’s economy even before the pandemic knocked the US. They prematurely smelled the imminent crisis that started to turn into an excruciating reality after an additional 3.3 million jobless workforce on March 26 joined the national tally in just one week.

Consumer spending roughly makes 70% of the US GDP so the blunt force trauma to the optimism of the biggest population segment was a telling indicator of what could happen to the world’s largest economy. Moreover, since the assessment largely relied on the data before the shutdowns and mass layoffs, economist at Harvard Kennedy School Megan Greene visualizes the next set of numbers “to be whole lot worse.”

It is in a sheer contrast to Trump’s frequent claims that the US economy is on historic high, perhaps greatest it’s ever been or “great American comeback” which were crossly disproved by the reality checks. The fetid truth is that the “envy of the world” he boasts of is yet to hit 3% growth whereas his most swanked assertions of creating 6.7 million jobs has been decimated by the Covid-19.

The top international asset management organizations are also skeptical of US economy rebound in the shorter period. Pacific Investment Management Co. (PIMCO), one of the leading global investment firms, predicted that the business closure and rising unemployment would likely contract the US GDP by 30% in the second quarter and 5% overall in in 2020.

Coronavirus outbreak has also triggered the Wall Street economists to rush out with shoddier predictions of economic disaster. JPMorgan, Goldman Sachs and Morgan Stanley are some of those who forecast the US GDP to drop by 24% to 30% in next quarter that would be 2.5 times bigger than any decline in history.

Fitch on Thursday also presented a gloomy picture about the US economy. One of the Big-Three global ratings agency said that the country’s GDP probably slipped by about 1% in Q1-2020 and is shaping to fall further by 7% in Q2-2020, more than the height of the Global Financial Crisis, based on the assumptions of social distancing measures to remain intact in the next few week.

Trump administration would hope that its herculean economic $2.2 trillion package, claiming every average recipient to receive benefits equal to nearly three times, would spur consumer spending to spin the US economic downturn but unless the virus is defeated, the government couldn’t expect Americans to pushcart the US economy.

For the week ended on April 4, another 6.6 million Americans lost their jobs, scooping the three-week total to 16.8 million. The situation would deteriorate further when many of Americans will not have jobs even if the contagion ends because most of the jobs created over the last few years were “temp gig or contract jobs.”

The speed and the magnitude of the US labor market is sharper than seen in the recent history and suggested that more stronger blow to the US economy. Former presidential candidate Andrew Yang described the outpouring as “We’re going to see something like 10 years of change in 10 weeks.”

Coronavirus pandemic has just started to take a toll on the US economy and it is in tatters. As other states in the country prepare for the closedown and the projected unemployment rate at 15% in April browbeats to surpass the size of the Great Recession, the US economy is poised to make a hard landing.