The coronavirus epidemic – who gains and who loses?

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CHARLES Dickens wrote in his book ‘A Tale of Two Cities’ these often quoted lines,

“It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair.”

Using this analogy for the current Covid-19 pandemic, which has now been with us for more than 10 months in terms of the global lockdowns and MCOs that commenced in early March; we can say for certain that in the face of this worldwide calamity there have been vast and varying variations of light and darkness, opportunity and disaster, gains and losses – from our own personal lives to what’s been going on in the world of business, finance, education, travel, and entertainment; to what’s been going on with the environment surrounding us and to the lives of all humans, animals, and other living creatures on this earth of ours.

We can broadly see three categories – the winners – those who stand to benefit; the losers – those who are suffering; and the in-betweens – those whose eventual fortunes are still uncertain but are highly dependent on how they are responding now or will do so in the immediate future.

 

Who are the winners right now?

These are found in the e-commerce marketplaces: by quickly responding they are catering to those who have moved online for their shopping, food catering, and all sorts of online business transactions. Just take a look at the number of new players in food-delivery apps and their delivery motorbikes and vans. There’s already Grab, Food Panda, Planet, Lyfe, Hungry, etc, etc. Even Tony Fernandez’s AirAsia has entered the market with AirAsia Food.

In the bigger international field, even Amazon is hard pressed to add on 100,000 new jobs to manage the extra demand since the pandemic broke! Chinese e-commerce giant JD.com has started using unmanned vehicles to deliver food and medical supplies in some Chinese cities.

Logistics, courier, and delivery companies around the world are reaping fortunes and will continue to benefit from consumers around the world shopping from home – as deliveries jump sky high with items ranging from protective clothing to pharmaceuticals to books, devices, gadgets, and cooking ingredients – the list is endless and the demand for all these appear to have no end in sight.

Videoconferencing start-up Zoom has been the star of the pandemic thus far. In a matter of 10 months the company’s sales and share price have zoomed from US$114 on March 2, 2020 to US$424 on Dec 2, 2020, an almost four-fold increase. Others like Webex from Cisco, Skype, and Teams from MSN are also seeing major surges. Everyone who works from home goes online or on webinars.

Another beneficiary from the pandemic has been entertainment streaming and gaming – platforms like Netflix, Amazon Prime video, HBO Max, and Disney + have all reported increased viewership and online gaming platforms are also experiencing record volumes. More people working from home and more family members and kids away from school have added to the increasing viewing audience statistics overall.

 

Who are the losers?

Every day we read about in the newspapers, watch on television, and scroll on online portals about the many businesses being closed down, downsized, or are retrenching staff. Such companies will need a miracle or a widely acceptable vaccine being made available very soon to be able to continue to survive through this crisis, probably the worst ever seen in our lifetime. Even if they do succeed eventually, many of these companies will not come through unscathed – most will be seriously damaged and altered beyond recognition. Most of them have already taken the decision to cut costs, cease or suspend operations, and only to return when conditions improve at a later time. Many will close down for good.

The global airline industry is hardest hit. It says it will need at least US$200 billion in emergency support in order to see through this period; Boeing for one has asked for US$60 billion in assistance; Virgin Atlantic has parked 85 per cent of its fleet and has asked staff to take up to eight weeks leave to avert job losses. The same scenario is repeated in every single airline company in every part of the globe today.

Closer to home, Air Asia X has closed all bookings up till October 2021; they have also shut down Air Asia Japan and Indonesia; and its Malaysia operations bled losses of RM454 million in the third quarter of 2020. In order to survive, Malaysia Airlines is currently seeking US$500 million fresh capital from its sole shareholder Khazanah – it may even fold if this is turned down.

Cruise ship operators have mostly ceased operations and bankruptcy is likely for many. The lay-offs of staff will certainly hit the entire industry hard.

Tourism worldwide has been the hardest hit. In the United States alone, the US Travel Association projects that at least five million travel-related jobs will be lost in the USA alone. Almost all ski resorts in the European markets have effectively been closed. It seems like no one is traveling anywhere at all except on television!

Closer to home, our tourist arrivals for Sarawak, according to the Ministry of Tourism, Arts and Culture website has shown a total of 1,174,092 visitors from January to October 2020; compared to the full year’s figure for 2019 of 4,662,419.

Our local travel industry needs all the financial aid and assistance that the ministry and the powers that be to help the many people and companies involved in the business. Let’s not let the ‘golden goose’ of our travel industry suffer through this very bleak and desperate period but do seek and implement ways and means to assist and help all the practitioners financially to enable them to tide over till the recovery, which is sure to come – hopefully by the middle of next year if the vaccine is successfully introduced and widely used by the end of the first quarter of 2021.

Cinemas too are closing down – online streaming coupled with platforms like Netflix where viewers can watch in the comfort of their homes are killing the way we watch movies. Traditional brick and mortar retail shops, especially for clothing, gadgets and devices are all going the way of the dinosaur too.

Lastly the in-betweens – those who need to struggle, some will fail, a few will readapt and modify, and some will take advantage of new opportunities.

Banking – some banks will lose money as businesses and individuals struggle to pay back loans. In healthcare, some in this sector will emerge with new ideas – pharmacies and drugstores will prosper and businesses continue to boom; but not all big companies
will be able to sustain themselves.

Manufacturing will thrive, especially those in the food and agricultural machinery sectors; others like car manufacturers, aircraft, and other transportation and suchlike will suffer.

Education will go towards online learning and the number of courses will increase thereby catering to an even wider range of subjects. Zhejiang University, one of China’s leading universities, has officially started online teaching by offering more than 5,000 courses, with 2,500 graduate students expected to do online studies.

I conclude with another very famous saying, this time from John F Kennedy in 1960 during a campaign speech – that the Chinese character denoting the character ‘crisis’ also means ‘danger’ and ‘opportunity’. In this era of the danger of the coronavirus, we should all look out for whatever opportunities there are out there for the future of us all.

May God continue to guide our ways and keep us all safe from the Covid-19 virus. Amen.