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The future lies in embracing the new economic normal

BY TAPIWA GOMO There is no doubt that 2020 was a challenging year and that the impact of the COVID-19 pandemic will be felt in the short and long term. However, emerging figures are showing us the down and upside of how the economy performed and who were the winners and losers and why as well as the future fears. The biggest lesson from the pandemic experience, so far, is that every challenge presents opportunities and how society or its members position themselves has lot to do with the losses or gains from chaos. The pandemic, lockdowns and other measures to curb its spread have had a huge bearing on various streams of the economy. Lockdowns resulted in reduced production and low or no income for some companies. For workers, it resulted in less or no income which pushed millions of families into destitution. Limited movements saw the transport sector recording huge losses. The oil industry, already facing stiff pressure from climate change advocacy, suffered historic $77 billion losses in 2020 as the COVID-19 pandemic sent demand and prices tumbling. Developed economies cushioned their citizens and their industries which minimised the economic impact of the pandemic. As they say, nothing is for free and someone will have to pay. It is most likely that the resources used to cushion citizens will be recouped from them in the form of taxes. But who cares if families survived the pandemic, industry was sustained and workers retained their jobs. That is the beauty of having an industrialised and advanced economy. Forbes estimates that more than 10 million more people are out of work in the United States of America as a result of the virus and they have only gained back nearly 50 000 jobs in January, a sign of slow recovery. Globally, the International Labour Organisation (ILO) estimates that approximately 255 million full-time jobs were lost due to the pandemic, with Latin America and the Caribbean, southern Europe and southern Asia being the worst affected. For informal economies such as Zimbabwe, it is not clear what damage the pandemic caused on the economy but the death toll — mainly of high-profile people suggests that the impact may be higher. Even with that massive economic toll on ordinary workers and citizens, they were big winners, mainly those who understood that challenges open up new opportunities. Forbes estimates that the world’s 2 200-plus billionaires increased their income to become nearly $2 trillion richer in 2020 when others were losing their income. While that is cause for celebration, it has an impact on the increasing divide between the rich and poor and widening economic inequality. Elon Musk was talk of 2020 with his fortune growing from $110 billion to nearly $137 billion, which placed him among the top five richest people in the world. His fortune is derived from increasing shares in Tesla Motors, which spiked by 630% in 2020. He took advantage of the slumping oil industry during the pandemic to demonstrate the importance of electric vehicles. That has put him in a strong position to push his

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