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How COVID-19 Changed the Economy Activities worldwide.
The corona virus outbreak, which was first detected in China, has infected more than 185 countries. Its spread has left businesses around the world counting the costs. Most organizations saw their biggest quarterly drops in this first four months of the year since 1987.
The past weeks have shown how health crisis, however temporary, can turn into an economic shock of liquidity shortages and market disruptions.
These are ways COVID-19 has changed the world economy.
How COVID-19 changed the Economy Activities Worldwide
Oil Price Crash
Oil prices have decreased by around 50% since January 2020, with countries on lock-down there is significantly less of all activity, and the demand for oil and gas has fallen spectacularly
Thus, the sector has seen an imbalance of oversupply and less demand, further exacerbating the price crash. This has trickled down and impacted a number of sectors that usually pull FDI focus, including the chemical, plastic and automotive sectors
Risk of Recession
If the economy is growing, that generally means more wealth and new jobs is erupting, It is measured by looking at the percentage change in gross domestic product or the value of goods and services produced, typically over three months, although it said that the COVID-19 has plunged the world into a crisis like no other, Success in fighting the virus has come in the price of slowing economic activity.
Corona virus has cursed the record of unemployment hit a high record in the United States of America and in Africa, Over 20 million Americans have now applied for unemployment benefits in the U.S, and has also increased unemployment in Africa mostly in the bank sectors.
Advance Usage of Technology
Government around the world have urged employees to work from home where possible, Many companies has shot up their doors as more people rely on video conference calls and email to hold meetings or get tasks done from their homes.
E-commerce soars; The market share for e-commerce has expand dramatically, perhaps even doubling. With more people doing more of their shopping online and others, forced to try it for the first time, finding it easy to order with e-commerce continue with it. This may cause businesses that does not have its e-commerce to pay a harsh penalty.
Fall in Aggregate Demand and Government Expenditure in Rise
In Nigeria, efforts were already being made to bolster aggregate demand through increased government spending and tax cuts for businesses. The public budget has increased from 8.83 trillion naira ($24.53 billion) in 2019 to 10.59 trillion naira ($29.42 billion) in 2020, representing 11 percent of the national GDP, while small businesses have been exempted from company income tax, and the tax rate for medium-sized businesses has been revised downwards from 30 to 20 percent. Unfortunately, the COVID-19 crisis has caused lots aggregate of demand, except for a fall in government purchases.
Companies with the best balance sheets will ride out this crisis best. but Companies with too much debt may not survive the heat or crisis of the pandemic,
Factories in Slow down
In china, where the corona virus first appeared, industrial production, sales and investment all fell in the first three months of the year, compared with the same period in 2019, China makes up a third manufacturing globally, and is the world's largest exporter of goods, restrictions have affected the supply chains of most factories. And with the look of things we hope that the economy will recover from the world pandemic and it's crisis to it's normal states.
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