Economic impact of COVID-19: implications for health financing in Asia and Pacific
COVID-19’s impact has gone far beyond its direct effect on morbidity and mortality. In addition to adversely impacting non-COVID health care utilization, the pandemic has resulted in a deep global economic contraction due to lockdown policies and declining demand and supply of goods and services. As a result, most countries are experiencing lower levels of GDP, rising unemployment, higher levels of impoverishment, and increasing income inequality. Some countries are more vulnerable to the economic contagion resulting from COVID-19, including those implementing more stringent lockdowns and those that are more globally integrated due to their dependence on trade, tourism, and remittances. In addition, countries with “preexisting conditions” of fiscal weakness due to higher dependence on external grant financing, low tax revenues, and large precrisis debt levels are struggling to implement countercyclical mitigative fiscal and monetary policies. In addition to declining economic activity, government revenues have declined, government borrowing is increasing, and public debt levels are projected to skyrocket globally.
