Nepalis knew all along that the economy, based largely on remittance, is unsustainable. But we never realised that it would meet such a chaotic fate.
Madhukar Upadhya
The dynamic global economy, a seemingly unstoppable force, came to a standstill due to the great lockdown in early 2020. The real impact of the lockdown may not be known for a long time, but the year 2020 will undoubtedly be a watershed year in changing our economic thinking. The expected massive job losses among migrant workers will likely have a knock-on effect on low-income countries like Nepal. Many of the migrant returnees may not go back to their previous workplace. Jobs in the domestic labour market have also been lost, though we can hope they will resume within a few months.
However, the consequences will reverberate for a long time to come. In the short term, the government will attempt to minimise the damage and offer stimulus packages for a quick revival of the economy. Unfortunately, we need to go beyond the short-term. In all disasters, the attention of the concerned bodies in the early phases is quite focused but quickly becomes nebulous, leaving the victims on their own, often to slip into deeper poverty. We cannot afford to do so this time.
The understanding of the possible scenarios awaiting us in the medium and long term may be found in two reports, one published in 2008 and the other in 2019; both reports captured the essence of many studies which outlined problems we were already facing over the decades and painted a rather worrying picture of the days ahead, if appropriate steps are not taken. A report published in 2008 attempted to understand the role of ecosystem services in the livelihoods of the poor in a rapidly changing urban-rural context of developing countries and revealed that intensifying processes of technological and economic globalisation in contemporary times have drastically changed the livelihood systems. On one hand, this globalisation largely helped to reduce poverty in many countries around the world. On the other, the process had consequences that not only increased pressure on the ecosystems but shifted the pattern of dependency on ecosystems from the local to more global levels. The degradation of the ecosystems from local to global scale continued to undermine ecosystems’ ability to provide critical services.
Even as the degradation continued, the issue didn’t get the level of attention it required for the revival of the crucial ecosystem services. Those who depended on local resources for their livelihoods and worked hard for their upkeep before the shift in the dependency pattern, need not do so anymore because with the income from remittance they could afford to buy food produced elsewhere in the global market to feed their families, better educate their children, and access health services. This growth of remittance also helped the service sector to thrive, making it a key contributor to the national GDP. Sadly, this growth was taking place at the cost of local resources. For example, in our case, farms were abandoned one after another, leaving a vast area in the hills and Tarai fallow. Import of food from the global market continued to rise to an alarming level. To ease the transportation of essential goods including food, building roads, which had extremely high environmental costs in the mountains, became a development priority. Intensive land husbandry, which is essential to maintain productivity of the Himalayan landscape, gradually vanished in the absence of caretakers.
A decade later, in 2019, the UN’s Human Development Report 2019 revealed the deeply unsettling reality of the rise of a new generation of inequalities in the 21st century. The report put this inequality in simple terms: ‘for all our progress, something in our globalised society is not working’. The report further emphasised that climate change, gender inequality, and violent conflicts would continue to drive these inequalities. An increasing number of educated young people are stuck with no ladder of choices to move up. In sum, the report highlighted the fact that many people in every country already had little prospect for a better future.
Under these circumstances, the world is faced with a pandemic of a scale not seen in the last hundred years. Experts view that Covid-19 is accelerating many existing fissures in the international system, which, by extension, is equally true for national systems. The pandemic has underscored how vulnerable our overall economy truly is. We knew all along that our economy, based largely on remittance, is unsustainable, but never realised that it would meet such a chaotic fate, making the post-pandemic situation extremely uncertain.
With the buffer provided by the labour market almost gone due to the great lockdown, we are left with limited choices to feed people, let alone revive the economy. The pandemic has brought us to square one. For some time, we are bound to face a rise in poverty because people have consumed what little savings they had during the lockdown. Jobs won’t be waiting immediately after the lockdown is lifted.
For many, foreign employment was an escape from grinding poverty, when agriculture failed to meet the rising needs and aspirations driven largely by a globalised economy. But the migrant returnees will have nothing to fall back on but agriculture, the only economic sector providing a breather at the moment, despite its own inherent problems. While a stronger agriculture base would’ve helped, we are now forced to take it seriously and improve the state of agriculture in order to support livelihoods with the outputs from ecosystem services which, in the first place, require serious restorations. Therefore, moving forward in the post-pandemic world will require a clear roadmap backed by commitment and actions.
Madhukar Upadhya is a watershed person, who writes about the rising tensions between a flourishing society and sustaining natural resources, including the emerging challenges of managing climate crisis.
This article was originally published on The Kathmandu Post.
Views in this article are author’s own and do not necessarily reflect CGS policy.
