Covid seems to have raised its head already in 2023. China got the ball rolling (yet again) with its sudden decision to do a 180º on its strict zero-Covid policy but the long-term effects of the pandemic seemed to be showing itself even in countries that dealt with the disease commendably.
Part one: the economy
When China decided to do away with its two-year-old policy last month, situations arose that prompted some to point out to similarities with December 2019 when the pandemic started. The Financial Times said of this, ‘Xi Jinping’s botched exit from his “zero-Covid” policy earlier in December — which lifted measures including mass testing and lockdowns — has overwhelmed many hospitals. Now, after almost three years in isolation, the decision to reopen Chinese borders, from January 8, has turned its domestic mismanagement into a potential global problem — again.’
This prediction, at present, appears to be more alarming than reality would suggest. But if Covid has taught us anything, it is that the virus may have started wrecking havoc long before we actually realise it is doing so. Caution is warranted.
Elsewhere too the effects of the pandemic are bearing their ugly heads. New Zealand, for example, which has long been hailed for its shrewd, timely and responsible handling of the pandemic—an act that secured its ruling government another term—is also seeing a shift in power. The island-nation’s Prime Minister, Jacinda Ardern, has made clear her plans to step down saying she does not ‘have enough in the tank to do it justice’.
For New Zealand the real problem lies not in an exhausted leader but in the economic impact of the pandemic despite its deft handling of it: the country’s central bank is trying to induce a recession to bring prices under control. China is not to blame in this given that New Zealand under Ms Ardern has tirelessly worked to shed its reliance on China and cozy up to the US instead.
Part two: pure sciences
Despite all this, governments have not learnt lessons from the pandemic according to Pfizer CEO Albert Bourla. While he may be making a selfish case, in his interview at Davos Mr Bourla stated that governments ought to be grateful to private companies running life science research in association with academia. ‘It’s not thank god, the WHO was there. It’s not thank god, the CDC was there,’ said the boss of the pharmaceutical giant.
There is truth in Mr Bourla’s statement and countries would do well to fund research in the pure sciences as well as make it easier for driven candidates to enter these fields. However, some added context makes it clear that Mr Bourla may have personal interest in the changing status quo. The lessons governments have learnt from the pandemic work against companies like Pfizer. There is now a push for greater scrutiny of research and—most exceptionally—legislation to regulate and reduce drug prices, which would cut right through big pharma’s balance sheets.
Should the government heed to Mr Bourla, though, and work towards funding pure science research (not only life sciences), there promises to be a considerable impact on the economy. The IMF estimates that doubling subsidies to private research and increasing public research funds by just 33% could increase productivity growth in advanced economies by 0.2 percentage points a year. Had this been done by the last generation—specifically between 1960 and 2018—the per capita income today would have been 12% higher.
Perhaps New Zealand should see this as an opportunity to fund and call in bright minds who can help the country build its pure science research base. Perhaps China can pivot from manufacturing goods to manufacturing ideas. If history is to be believed, we do not learn our lessons reliably.