When a minor viral infection erupted at a wet-market in the Chinese city of Wuhan in December 2019, there was no indication that it would soon transform into a global pandemic the likes of which the world has not witnessed in the past one-hundred years.
By the time the international community began to realize the magnitude of what they had to contend with, and world health authorities belatedly conceded the disease was a full-blown global pandemic, the virus had already spread across much of the globe.
The contagion overwhelmed health systems, challenged policy-makers, confined students and workers to their homes, and devastated economies around the world, all the while infecting millions and claiming the lives and livelihood of people everywhere.
A year into the pandemic, the world is still grappling with a persistent virus that remains resistant to known treatments, and which continues to infect and cause deaths worldwide.
Despite the recent roll-out of several vaccines against the disease in many countries, the virus has remained potent, mutating into new strains that could potentially overwhelm current preventive measures and further challenge the global scientific community.
Kuwait like every other country has not been immune to the virus. The global pandemic, which was first reported in the country in late February 2020, continues to extract a heavy toll on the state. It has constrained mobility of people, disrupted social interactions, dampened market enthusiasm, and stifled economic growth across all sectors. Public weariness with extended restrictions, and growing disdain for the recommended health and safety guidelines, have probably contributed to the sharp increase in infections and fatalities reported in recent weeks, and which in turn has exacerbated the already precarious situation.
However, it is not all doom and gloom after an year of the COVID-19 crisis, which has been described in some quarters as annus horribilis, a horrible year marked by disaster and misfortune. There were plenty of instances where our response to the pandemic has been extraordinary, and we should build on these strengths. But there were also many shortcomings, from which we could learn valuable lessons that would allow us to build back better and which could help develop a more resilient and diversified economy in the years ahead.
Taken as a whole, the overall response of the government to the pandemic has been at best mixed. On the health front, the authorities are no doubt doing an admirable job, they have been transparent and forthcoming on news about the infection from the beginning of the outbreak. Health ministry officials provide daily reports on the evolving situation, even as medical personnel from the health ministry, along with other government entities, civil society organizations and volunteers, continue to do a remarkable job of responding to the virus and assisting those in need wherever they are in the country.
Medical professionals have also moved quickly and efficiently to test, trace, quarantine and treat those infected. And, since the roll-out of the vaccination campaign in late December of last year, the health authorities have so far vaccinated over half a million people in the country. Similarly, on the social front, the ministries of commerce and social affairs, along with other relevant bodies, have worked tirelessly to ensure people have access to essential food supplies, in addition to providing the country with sufficient reserve stocks of food and other essential items.
However, it is in its economic response to the pandemic that the government has been found most wanting, and been widely criticized. Beleaguered by the virus and by the stringent response of the authorities to contain and curtail the viral infection, the economy which was already in a fragile state to begin with, has been floundering to find a footing since the start of the pandemic.
A liquidity crunch that the government has been desperately trying to shake-off has tenaciously persisted into 2021. Relatively low global oil prices throughout 2020 that led to a sharp fall in state revenues and a yawning budget deficit continues to deplete whatever reserves the government had in its treasury, the General Reserve Fund. In addition, since the start of the crisis, the shortfall in the budget has widened from the emergency expenditures and measures that the authorities had to incur in order to tide over the various financial fall-outs from the outbreak.
Notably, in the early stages of the pandemic, with the financial hands of the government figuratively tied in knots, it was the Central Bank of Kuwait (CBK) along with banks and other financial institutions in the country — undoubtedly, on orders of the authorities — that stepped in with measures to ease financial restrictions and revive the economy.
To encourage banks to lend to customers, the CBK reduced discount rates to banks to a historic low of 1.5 percent, and lowered Capital Adequacy Ratio from 13 percent to 10.5 percent. Risk weightage for lending to small and Medium Enterprises (SMEs) was also sharply lowered from 75 percent to 25 percent. This accommodative stance by the CBK allowed Kuwait Banking Association — a grouping of the country’s major commercial lenders — to announce a moratorium of up to six months on bank loans, including waiver of interest and postponement charges, if any, for both citizens and expatriate retail clients, as well as SMEs.
For its part, a Cabinet meeting on 31 March, 2020 approved a slew of measures to support the economy, including providing loans on concessional and long term basis to SMEs, as well as postponed payment of installments funded by the Kuwait National Fund for SMEs and the Industrial Bank of Kuwait. In addition, self-employed Kuwaitis registered under Chapter Five of Social Security Law were provided support with salaries and given exemption from contribution towards social insurance for a period of six months.
While the economic stimuli offered so far have provided relief to many, it has not helped the economy overcome the pressures brought on by the simultaneous demand and supply shocks that erupted following the pandemic.
On the demand side, the unrelenting spread of infections and increasing deaths in the country tempered consumer and market sentiment that led to a sharp fall in demand. At the same time, on the supply side, the strict measures introduced by the authorities to rein-in the virus and to control infections had the unintended consequence of curtailing supply, by restricting business and economic activity in the country.
Repeated partial and full curfews, long lockdowns, and closure of land borders, as well as air and sea ports, constrained economic activity in the country and had a negative impact on market sentiment. On the other hand, the restrictive measures imposed had seemingly little impact in curbing infections or improving the overall pandemic situation in the country. Obviously, without additional support and timely intervention from the authorities, the economy is expected to continue its apparent free-fall down an endless chasm.
Faced with what appeared to be a life and death threat from an unseen virus, the authorities were understandably nonplussed and probably overreacted, when the number of infections and deaths began to rise sharply in mid-May of last year. A timeline of the response by authorities reveals the hotpotch nature of decisions it has taken over the past one year.
Initially, the authorities responded to the infections by suspending work across all public sector entities on 11 March, and four days later, suspended all commercial air travel and border crossings. The authorities also urged people to stay at home voluntarily. But, voluntary being synonymous with ‘ignoring’ in Kuwait, the government had to resort to a partial curfew from 5pm to 4am from 22 March, which was then extended until 6am on 6 April. The curfew timing was further extended to 8am to prevent congestion during Ramadan that began on 24 April.
With the number of infections showing no signs of abatement, the authorities decided to impose a 20-day full curfew from 10 May to the end of that month. The full curfew was gradually eased from June, in what the government termed “a five-step, phased return to normalcy.” However, since August 2020, Kuwait has remained stuck in phase-four of its return to normalcy.
Following another spike in infections at the start of 2021, the government again resorted to restriction on movement and closure of business activities from 7 February of this year. The authorities also banned the entry of non-citizens to the country, initially for a period of two weeks, which has since been extended ‘until further notice’. Celebration venues and all public gatherings, including National and Liberation Day celebrations slated for later that month, were also banned.
The restrictions and partial curfew that were initially for a month and scheduled to end on 7 March, have now been extended for one more month until 8 April, in the wake of 1,716 new infections being recorded on 4 March of this year. The pandemic has evolved rapidly since the first confirmed cases of coronavirus infection were reported on 24 February of last year. The first cases were among a group of travelers who had returned on a flight to Kuwait from the Iranian city of Mashhad,
where the disease was rife at that time. Five days later, by the end of February, number of reported cases in the country had grown to 45.
By mid-May the number of Infections had soared to cross the 10,000 mark, with the virus adding a new dimension to its presence in Kuwait by claiming its first victim, a 46-year-old Indian national, who succumbed to the illness on 4 April. Remarkably the country managed to hold down deaths from the disease, with the total number of those who succumbed to the virus remaining below 100 for nearly a year of the pandemic. The fatality number crossed the 1,000th mark only on 14 February of this year. Though the relatively low death-rate was a relief to the health authorities, it was no consolation to the hundreds of families left bemoaning the precious lives they lost to the virus.
Since the start of the pandemic, with the exception of a few days in May 2020, the number of infections reported daily had also been below 1000. However, since the middle of February 2021, the number of daily infections have remained stubbornly above the 1,000 mark, with the highest number of daily infections recorded on 4 March, when a total of 1,716 people were confirmed to be infected. The number of critical cases needing admittance to intensive care units in hospitals, which had remained below 100 since November, have also soared from early February, with new daily admittance to ICUs averaging over 100 since then.
While Kuwait began conducting random swab tests only on 13 May, the number of daily swabs have remained below 10,000 for much of the time and has crossed into five-digit territory only occasionally. Unsurprisingly, a year into the pandemic, Kuwait has managed to test less than half its population, reaching a total of just 1,960,138 test-swabs by last week.
And, as of Friday 26 March, there were a total of 225,980 reported cases in the country, with 210,024 people recovering from the illness and 1,270 succumbing to it since the start of the outbreak. And, this is where the country remains one year following what has no doubt been an annus horribilis. The hope is that the traumas of the year gone by will lay the foundation for the government to build back a better and more resilient economy, and country, going forward.
– The Times Kuwait Report