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Opinion

WASHINGTON DC, Jun 16 2020 (IPS) – The world saw more new confirmed COVID-19 cases last week than any week to date. And as the pandemic grows, its epicenter is moving from advanced economies to more developing countries, including Brazil, India, and South Africa.

How is the pandemic likely to evolve as it spreads to poorer countries?

In a new working paper, we attempt to answer one piece of that question, predicting the infection fatality rate, or IFR, for COVID-19 for 187 countries based on demography, comorbidities, and the strength of health systems.

The IFR numbers we report are somewhat higher—sometimes dramatically so—than the figures given for many developing countries in earlier influential studies, including the Imperial College team’s scenarios for the global pandemic and a recent report by the WHO Africa bureau.

That difference can be chalked up to how we incorporate two factors: pre-existing health conditions, and the relative strength of health systems.

For many developing countries, comorbidities partially offset the advantages of youth

A recent study in Science by Salje et al., for instance, finds that with French-level healthcare, the probability of dying with COVID-19 rises roughly eight-fold when moving from the 60-69 age group to the 70 and above range. This is good news for developing countries, which generally have a much younger population than France.

Most previous forecasts of the COVID-19 infection fatality rate have incorporated this demographic advantage. However, they have generally not included the offsetting effect of cross-country differences in comorbidities.

Those comorbidities—such as diabetes, hypertension, and ischemic cardiovascular diseases— matter a lot. Data from Italy show that roughly 96 percent of COVID-19 fatalities report one or more relevant comorbidities.

Inverting that probability using Bayes’ rule and data on France’s IFR and comorbidity distribution, we find that the probability of dying from a COVID-19 infection for patients under 40 is roughly 134-times higher with a relevant comorbidity than without.

Developing countries generally have lower rates of relevant comorbidities compared to high-income countries (where the best measures of infection fatality rates come from). But whereas comorbidities are concentrated among the elderly in rich countries, some developing countries—such as South Africa—report a considerably higher share of these conditions among middle-aged people.

Future work would benefit from more careful treatment of comorbidities like HIV/AIDS that have higher prevalence in lower-income countries. But even a simple adjustment for comorbidities partially undermines many developing countries’ demographic advantages.

Evidence from other viral respiratory infections suggests a much bleaker scenario for COVID-19 in the developing world

So far, our estimates assume that an individual infected with COVID-19 in, say, Uganda has the same probability of dying as someone with the same sex, age, and number of comorbidities in France. Clearly that’s optimistic, given the overall capacity of Uganda’s health system relative to France’s. But exactly how optimistic?

To gauge how much fatality rates might vary with health system capacity, we draw on estimates of the infection fatality rate for another viral respiratory infection, namely influenza. We focus on children under five years old, to purge variation in age and comorbidities that typically begin later in life, and scale the odds ratio of dying from COVID-19 by the ratio of child influenza death rates across countries by income group.

Adjusting for health-system capacity in this way yields COVID-19 infection fatality rates that are considerably higher than previous estimates for the developing world. For the five countries in Sub-Saharan Africa with the largest confirmed COVID-19 epidemics to date, our results are roughly twice as high as those from Imperial College, which does not factor in comorbidities or health system strength beyond a simple capacity constraint on hospital beds.

And they are roughly eight times higher than forecasts from the WHO Africa, which do not adjust for health system capacity and only scale the IFR downward (never upward) due to comorbidities.

Comparing predicted COVID-19 infection fatality rates across studies

Our results are more in line with the Imperial College predictions for Europe, as shown in the bottom panel above. For the five European countries shown, we can also compare to a more “gold standard” benchmark, i.e., infection fatality rates calculated on the basis of seroprevalence studies of a random sample of the population (blue bars).

Both our results and the Imperial college results match these seroprevalence studies fairly well on average, but fail to explain much of the intra-European variance (some of which may be due to variance in how deaths are counted, e.g., Belgium’s fairly liberal definition of a COVID-19 death to include all unexplained nursing home deaths).

In short, our IFR estimates seem fairly plausible for Europe, where we have an independent reference point, and our results suggest that earlier predictions for developing countries that ignore health system capacity may be far too optimistic.

In line with recent news reports, it’s likely young people will make up a larger share of COVID-19 deaths in the developing world

In the United States to date, patients over 75 years old represent over 60 percent of COVID-19 deaths. In Italy, the number of fatalities above 70 is 85 percent.

Both demography and weak health systems explain why COVID-19 deaths are more concentrated among younger people in the developing world

Although predicted IFRs display a steep age gradient in all contexts, due to demographic differences the bulk of deaths in low- and lower-middle income countries is predicted to come from middle-aged patients (40-70).

Less obviously, differences in health system capacity are also likely to flatten the age gradient of COVID-19 deaths in developing countries. In Europe, data is consistent with the hypothesis that intensive care saves the lives of a higher proportion of young than elderly COVID-19 patients. Thus, when high-quality intensive care is lacking, the advantages of youth are more muted.

These estimates are far from the final word on this question. But we hope that our calculations provide an important cautionary note about developing countries’ demographic advantages in facing down COVID-19.

Planning for the ongoing pandemic response and calibration of containment policies should factor in the wide variation in predicted IFRs across contexts. Specifically, policymakers in low-income countries should be cognizant that any demographic advantages with respect to COVID-19 fatality rates are likely to be partially offset by disadvantages in terms of the age-distribution of comorbidities, and even more so by gaps in health system capacity.

*Justin Sandefur is a senior fellow at the Center for Global Development (CGD) ; Selene Ghisolfi is an economics post-doc at the Laboratory for Effective Anti-poverty Policies Bocconi, and a PhD student at the Institute for International Economic Studies, Stockholm University; Ingvild Almås is a professor of economics at the Institute for International Economic Studies, Stockholm University; Tillmann von Carnap is a PhD student at the Institute for International Economic Studies, Stockholm University; Jesse Heitner is a health economist at Aceso Global; and Tessa Bold is an associate professor at the Institute for International Economic Studies, Stockholm University.

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Opinion

Johnny Miller is a photographer, documentary maker and UN-Habitat Champion based in Cape Town South Africa.

High rise apartments & green spaces contrast with the adjacent sprawling slum area in Mumbai, India. Credit: Johnny Miller

CAPE TOWN, South Africa, Jun 12 2020 (IPS) – From shocking death tolls to widespread job losses, there is no understating the severity of the COVID-19 pandemic’s impact on the world’s cities.

Health care systems, economies, and social lives have been upended by a virus for which the world was totally unprepared.

But even as cities struggle with basic needs like providing a safe environment for all, there is as an opportunity for long-lasting changes to make our cities both more prosperous and equitable and less vulnerable to future shocks such as highly contagious diseases.

Cities and local governments should be recognized for steps they are already taking to build public health, social, and economic resilience during this crisis. They are disinfecting public transport and are keeping public spaces clean.

They are mobilizing both professional and volunteer networks to source, make, and distribute personal protective equipment for frontline workers. They are making sure food reaches older persons who are self-isolating for their own safety and struggling families with children who are no longer going to school, being challenged equally by new ways of working such as home schooling and home office.

This unprecedented moment requires emergency action and social solidarity. We can seize on this brief window to “retro-fit” and make permanent improvements by both delivering the fundamentals of sustainable cities from the pre-pandemic era and adopting the measures that are likely to be necessary in the post-pandemic era.

Our future cities need to be resilient, sustainable, inclusive and equitable. They need to be forward-thinking, able to innovate and better positioned to withstand shocks and catastrophes like the Covid-19 pandemic.

To do this they will need to respect core human values of dignity and care, and invest in citizens’ health along with decent shelter, clean water, and free education. They will recognize that diversity is a strength, and that achieving equality of outcomes for all means safeguarding the rights of expression and culture.

Future cities must rethink and reorganize their built environment using the lenses of equity and access. COVID-19 has exposed the reality of profoundly divided populations. Regenerating neglected urban areas can bring healthy, sustainable benefits to local communities, which in turn increases city resilience as a whole.

Connecting communities with people-friendly parks, green spaces, and community-aligned infrastructure allows neighborhoods to prosper and thrive once more.

We see some cities embrace the “new normal’. Lyon has a plan to more permanently house 1,500 homeless people who were offered temporary shelter during France’s lockdown. Cities around the world have closed streets to cars in order to provide more space for pedestrians and cyclists.

Already, Seattle and Paris have said some of those changes will be made permanent. Bogota, one of South America’s most cycle-friendly cities and already a leader in sustainable transport, just dedicated over 70 more kilometers of bike lanes on top of the 550 that already exist.

With the disruption of global supply chains and long-distance air travel, it is possible that future cities will look and act more locally, with localized and self-sustaining networks of food production, green spaces, and even power generation.

By moving away from a reliance on overseas producers, we can unlock the true value of neglected assets and resources within communities which currently lie dormant.

At the same time, the cities of the future will be more reliant on digital technology and the wide utilization of the internet even as children learning from home eventually go back to school and knowledge workers connecting remotely will eventually return to spending more time in the offices again.

Even in the poorest regions of the world, city dwellers are beginning to rely on the internet for education, business, banking, and social relationships. COVID-19 has already opened our eyes to a world where only those with the freedom and privilege to be able to access the online world are the ones able to access all society has to offer.

The current crisis provides an opportunity for cities to ensure that digital services are available to everyone, but they need to take a proactive approach to digital technologies.

This could include investing in community broadband and free public wi-fi, providing digital literacy and skills to older people and marginalized communities and making websites and online platforms accessible to people with disabilities. Bridging the digital divide, already a pre-pandemic challenge, will be essential to building back better neighborhoods.

The good news is that many cities already see the benefits of resilient, inclusive societies, and some areas like Kerala state in India are weathering the COVID-19 storm well even without massive financial resources.

This is showing that focusing on public health delivery in a compassionate, equitable way, is just as important as economic stimulus to the recovery of a region once the pandemic is over.

The choices we make in the next year will define our societies for an entire generation and perhaps beyond. Let’s use this opportunity as a fulcrum to leverage the future that we know we can build together.

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Opinion

Antonella Teodoro is Senior Consultant at the UN Conference on Trade and Development (UNCTAD) & Luisa Rodriguez is Economic Affairs Officer, UNCTAD

GENEVA, Jun 11 2020 (IPS) – In the first quarter of 2020, the coronavirus pandemic led to a 3% drop in global trade values. COVID-19 could trigger the biggest economic contraction since World War II, affecting all industries from finance to hospitality.

As there is significant uncertainty about how the epidemiological and economic situation will evolve, assessing the duration and the gravity of the pandemic seems like an impossible task.

However, recent forecasts suggest: trade volumes decreasing between 13% and 32% in 2020 (WTO, 2020), global growth falling to -3% (IMF, 2020) and different maritime seaborne scenarios ranging from a return to sector average (around 3% p.a.) after 2022 to growth rates falling by 17% by 2024 (Stopford,2020)[i].

Industries whose operations are more globalized (and particularly those that rely on Chinese inputs for production) were most exposed to initial supply chain disruption due to COVID-19. This was the case for precision instruments, machinery, automotive and communication equipment (UNCTAD, 2020).

Given its non-essential nature, the fashion industry faces significant risks. Indeed, in times of COVID-19, as consumers around the world remain in lockdown, they no longer need new products. This industry is characterised by a highly integrated global supply chain.

In it, many developing countries play the role of the supplier of low-cost inputs. This article highlights some of challenges and concerns that some of these countries face, many of which are dependent on textile and garment exports.

The textile industry supply chains, trade logistics and developing countries

The accession of China to the WTO (2001) and the expiry of the WTO Agreement on Textiles and Clothing (which ended a 10-year trade regime managed through quotas) on 1st January 2005 contributed to making China an important centre of textile and clothing global value chains (GVCs).

These two developments led to shift apparel production and sourcing (by globalized retailers and producers) to China and other Asian countries because of low labour costs (UNCTAD, 2005), following the cost-reducing logic of GVCs.

As wages gradually rose in China and Chinese plants moved to produce higher-value goods, countries like Bangladesh, Pakistan and Vietnam, with lower wages costs started attracting factories to relocate their production from China.

At the global level, China remains an important supplier of fashion goods (as shown in Figure 1) but has also become an important consumer of this industry.

Figure 1: Top 20 exporting countries of fashion goods*
(share in global exports), estimated TEU 2019

* SITC, 2-digit categories including: Textile fibres, Textiles & made-up articles, Clothing & accessories. (Source: MDS Transmodal, March 2020)

Major exporters of fashion goods for whom exports in the sector represent a significant share of export earnings are shown in Figure 2. Consequently, the Asian country most badly affected by the disease outbreak could be Bangladesh where circa 85% of its exports include fashion goods, as shown in Figure 2.

Figure 2: Top 20 exporting countries of fashion goods*
(share in total country exports), estimated TEU 2019

* SITC, 2-digit categories including: Textile fibres, Textiles & made-up articles, Clothing & accessories. (Source: MDS Transmodal, March 2020)

Given the globalized nature of the industry, companies and retailers must transport their goods and raw materials across many countries. Besides China, other countries play an important role as key hubs around which trade of fashion products takes place.

This is the case for the United States (as the most important retail market), and some European countries (such as Belgium, Germany, France and UK), with ports such as Rotterdam and Antwerp featuring prominently in this trade. (CO, 2018).

From a logistics point of view, the textile, apparel and garments industry is considered a time-sensitive industry. Irregularities in making goods reach a particular place at a specified location on time can lead to reduced (or no) profits for the textile owner.

In addition, clothing collections change quickly: their lifecycle is short (as perishable products) and their commercialization is characterized by strong seasonal peaks. In this sense, textile logistics are characterized by small stocks and short delivery times.

These goods and raw materials are usually transported using a combination of land, sea, and air. Within this trade logistics context, strong multimodal interlinkages are key to ensure Just in Time delivery.

E-commerce developments have further accentuated time-related logistics requirements, such as next day delivery, as well as the capacity of handling a large volume of returns and offering the possibility for manufacturers and dealers to check the location of their articles at any time.

Emerging concerns related to COVID19 from the perspective of developing countries

The COVID-19 outbreak led to production stops in China first, followed by closures of shops elsewhere around the world.

For the moment, European and American retailers, the two destination markets for this sector, are still cancelling their orders. Cancelled orders are a cause for concern in many sourcing countries.

As shippers are increasingly invoking ‘force majeure’ clauses within their contracts to halt their payments, on 8 April, the Sustainable Textile of Asian Region (STAR) Network, the body, which brings together representatives of the producing associations from Bangladesh, Cambodia, China, Myanmar, Pakistan and Vietnam, released a joint statement on the issue.

It urged brands and retailers to consider the impact that their purchasing decisions during the coronavirus pandemic could have on workers and small businesses in the supply chain and, therefore, to honour their contracts with their suppliers.

In their statement, the STAR Network invited global businesses to “support business partners in the supply chain as much as possible, and aim at a long-term strategy of business continuity, supply chain unity and social sustainability.”

Supply chain disruption: the reduced production perspective

The evolution of local epidemiologic situation in key sourcing countries, has impacted workforce availability and production, as well as multimodal logistics underpinning global value chains.

One of the concerns in this respect is that production of fashion goods could be moved away to other sourcing countries that are resuming activities faster in the Asian region or that are closer to retailers to diversify their supply chain risk.

Governments in developed countries around the world are implementing unprecedented actions to ease the effect on their economies from measures put in place to limit the spread of the pandemic.

Most developing countries do not have similar financial means, health systems or social safety nets to respond to the COVID-19 pandemic crisis and its economic impacts.

In this context, various assistance packages have been announced by IMF, the World Bank and others with a view to supporting economies, including emerging market economies.

Transport connectivity impact

Observable changes derived from the pandemic concerning maritime transport networks include, for example a reduction in service frequency (blank sailings and idle fleet) and changes in routing affecting particularly Asia-Northern Europe services, a key axis in the trade of fashion goods.

Shipping lines are reducing the number of port calls in the maritime services they offer to adapt to declining demand and cargo imbalances (JOC, 2020).

This is likely to affect the liner shipping connectivity of sourcing countries both in terms of intercontinental as well as intra-regional feeder calls and, if this situation persists, could make economic recovery even harder.

The fashion industry is undoubtedly under pressure in these uncertain times. Depending on the role that countries play in the supply chain, building resilience could entail different needs and approaches.

Prospects appear particularly bleak for low-cost sourcing countries that are highly dependent on textile and garments exports for revenues, concurrently faced with the challenge of limited financial means and less developed health systems and social safety nets to cope with the socio-economic effects of the pandemic.

In the short-term, lockdowns around the world have thrown a spotlight on risks associated with high supply chain interconnectedness and challenges associated with global sourcing.

This has also had an impact on trade logistics, as the glue that holds global value chains together. Observable changes introduced in maritime transport services to cope with reduced demand and cargo imbalances illustrate this.

The key question is what will this mean in the longer term, after surviving this unplanned humanitarian and financial crisis, particularly for the weakest links of the chain?

Driven by growing pressure towards more environmentally friendly lifestyles, the fashion industry was already confronted, before the pandemic, with increased concerns regarding its sustainability footprint, particularly consumption patterns associated with ‘fast fashion’ (increasing levels of expenditures and waste disposal) and associated production patterns (workplace conditions, environmental impact of textiles processing).

Will the current crisis accelerate a transformation in consumption patterns, inducing structural changes to the industry supply chain?

For example, could it lead to generalize new models such as ‘seasonless designs’ or lead to shorter value chains (i.e. increased local or regional sourcing)? Certainly, moving away from the “just in time” or “made- to- order” business models will have an impact on trading and transport patterns.

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