By Livy-Elcon Emereonye
It’s no more news that the emergence of Wuhan virus identified as Corona virus code named COVID-19 (the acronym derived from “new Coronavirus disease 2019”) has altered the phase of humanity. It also changed the world order and brought about a new normal that among others has great business implications.
Coronavirus disease 2019 is a mild to severe respiratory illness that is caused by a novel coronavirus now called severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2; formerly called 2019-nCoV), which was first identified amid an outbreak of respiratory illness cases in Wuhan City, Hubei Province, China. It is transmitted by contact with infectious material (such as respiratory droplets) or with objects or surfaces contaminated by the causative virus, and is characterized especially by fever, cough, and shortness of breath and may progress to pneumonia and respiratory failure. It was initially reported to the World Health Organization (WHO) on December 31, 2019. WHO declared the COVID-19 outbreak a global health emergency on January 30, 2020 and a global pandemic on March 11, 2020.
COVID-19 gained more attention through media hype and thereafter created fear – absolute fear. While the health implications of Corona virus were being hammered, no one looked at the economic angle until it became late when irreparable damage had been done.
Because the world is a global village, what affects one place would most likely have ripple effects on other places.
Looking at the title of this article, one might ask; “What has Ponzi got to do with COVID-19 Pandemic”?
To start with, “a Ponzi scheme is a fraudulent investing scam promising high rates of return with little risk to investors. The Ponzi scheme generates returns for early investors by acquiring new investors. This is similar to a pyramid scheme in that both are based on using new investors’ funds to pay the earlier backers. Both Ponzi schemes and pyramid schemes eventually bottom out when the flood of new investors dries up and there isn’t enough money to go around. At that point, the schemes unravel.”(https://www.investopedia.com/terms/p/ponzischeme.asp
“The rapid outbreak of the COVID-19 presents an alarming health crisis that the world is grappling with. In addition to the human impact, there is also significant economic, business and commercial impact being felt globally. As viruses know no borders, the impacts will continue to spread. In fact, 94 percent of the Fortune 1000 across the globe, and businesses in Nigeria have been impacted and are already seeing COVID-19 disruptions.” (https://home.kpmg/ng/en/home/insights/2020/04/covid-19–a-business-impact-series.html)
The transition from a local infection through an epidemic to a pandemic was so fast but then China was or seemed prepared and swung into action, tackling the challenge head on and leaving no stone unturned in search of solution – and it was so with many other countries.
In Nigeria, however, we’re more reactive than proactive, and being a consumer economy did not help matters. Our management approach was a “mere copy and paste” model from foreign countries and international organizations especially World Health Organization (WHO) and Centre for Disease Control (CDC).
The first case to be reported in Nigeria was an Italian citizen who works in Nigeria and returned from Milan, Italy to Lagos, Nigeria on the 25th of February 2020 but was confirmed by the Virology Laboratory of the Lagos University Teaching Hospital, part of the Laboratory Network of the Nigeria Centre for Disease Control (NCDC) on the 27th of February 2020.
The outbreak of COVID-19 in Nigeria exposes the rot and the degree of unpreparedness in our health sector, showing the shallow foundation upon which our weak health system is built. It goes further to show the level of our vulnerability as a people divided at heart, playing politics with virtually everything as revealed in the way and manner the “COVID-19 Palliatives” were collected, collated and shared at regional, state and individual levels. The overall management of the pandemic left much to desire.
Depending on others for a living, our survival is at their mercies. The moment Wuhan, China was down, everything was directly and indirectly affected in Nigeria because Nigerians import too many things from China!
Using the health sector as an example, the price of every pharmaceutical, medical consumable, device and equipment went up geometrically and got out of the reach of the common man because the Chinese were not producing and exporting to us. It was so bad that a pack of disposable surgical face mask by 50 pieces that sold for about five hundred (N500) Naira before COVID-19 went up to about fifteen thousand (N15,000) Naira. Almost the same thing happened with Infrared Thermometer that the price moved from six thousand (N6, 000) Naira to about eighty thousand (N80, 000) Naira. With the rate prices of these products were going up, they became the new Ponzi game – and many people jumped into it for quick money!
Forces of demand and supply played a big role in these price increments, however, our consumption pattern and over dependence on other countries for almost everything remains the major factor.
But for few of us, who swam against the tide and spoke against the criminal hike in prices of these products, things would have been worse. A piece of 3-ply face mask could have sold for a thousand (N1, 000) Naira or more. We embraced the challenge, looked inward and came up with the idea of locally made face masks using pieces of cloths, handkerchiefs, and encouraged people to use them. This is one of the ways many people started masking up.
Like a well calculated Ponzi where few early birds make some quick cash, those with old stock and those who ventured into importing the products by air very early made some money before the market got flooded and prices crashed. Many people who saw face mask as the fastest money making business and invested heavily in it might have sour tales at the end as they might end up losing more money and incurring big debts. This is one of the ways the COVID-19 pandemic made some people very poor in Nigeria.
While China seems to have adjusted to the new normal, doing everything to boost the economy and remain relevant in the scheme of things, we are still at the stage of “conducting tests and announcing results”, “soliciting for palliatives and donations” even when businesses suffer and the economy collapses.