BUSINESS AND COVID-19
Suhaib Ashraf Bhat.
Morning comes another dayHow can one be expected to live this wayToo much to handle, depression and painChaos and torment, almost drive me insaneShadows fall as night draws nearIt’s not the darkness that I fearHaunting memories too much to bearA life full of tragedy and despairHow much suffering should one soul sustain?Take this nightmare and its pain.
Coronavirus (COVID-19), a virus that grew stealthily has become one of the deadliest viruses that is killing people worldwide. This virus took birth in Wuhan city of China and since then have travelled to more than 160 countries. The World Health Organization (WHO) has declared Coronavirus as a pandemic. It has become a mass scare and is leading to the deaths of thousands of people in numerous countries including China, Italy, Iran, Spain, the US and many more. In India, this pandemic started on 30 January 2020 by affecting an individual who had travel history from Wuhan, China.World economy is seeing its greatest fall ever. Corona virus has largely impacted the growth of almost every country and is responsible for the slump in GDP worldwide. Like other countries, India is also impacted by this virus. Almost every industry sector has seen a fall in their sales and revenue. Share markets that include Sensex and Nifty are on nose dive since the occurrence of this pandemic (COVID-19). Sensex has declined close to 8000 points in a month. This could be the beginning of a recession that Indian market will never want to witness. Investors are advised to stay safe and invested in this virus-infected stock market. Few industries that can benefit from novel coronavirus during the time of market crash are pharmaceuticals, healthcare and Fast Moving Consumer Goods (FMCG). Due to this outbreak, almost 80% of Indian companies has witnessed cash flow difficulty and over 50% of companies are facing operations issues. As per Federation of Indian Chambers of Commerce and Industry (FICCI) 53% of companies are impacted by COVID-19. Slow economic activity is resulting in cash flow problems eventually impacting repayments, interest, taxes, etc. The consequences of the coronavirus disease (COVID-19) outbreak are unprecedented and felt around the world. The world of work is being profoundly affected by the pandemic. In addition to the threat to public health, the economic and social disruption threatens the long-term livelihoods and wellbeing of millions. The pandemic is heavily affecting labour markets, economies and enterprises, including global supply chains, leading to widespread business disruptions.The ILO and its constituents – Governments, workers and employers – will play a crucial role in combating the outbreak, ensuring the safety of individuals and the sustainability of businesses and jobs.The coronavirus disease 2019 (COVID-19) is no exception. The disease – became a global pandemic – emerged in a densely populated manufacturing and transport hub in central China and has since spread to 29 other countries and regions (as of 20 February 2020), carried along by Chinese New Year and international travel.In contrast to the Western Africa Ebola emergency of 2013-2016 – more deadly but less contagious, arguably more isolated, and eventually contained in part by richer countries putting money into Africa – COVID-19 presents larger, more interdependent economies with management dilemmas. It has also surfaced at a time of eroding trust within and between countries – with national leadership under pressure from growing societal unrest and economic confrontations between major powers.Effective governance of cross-border crises such as pandemics involves preparedness, response and recovery at local, national and international levels. Epidemic preparedness assessments show many countries, especially in regions where new pathogens might emerge, are not well equipped to detect, report and respond to outbreaks. Response strategies vary, for example: playing up or playing down crises and staying open for business as long as possible versus seeking to reopen quickly. COVID-19 has highlighted tendencies in many countries to deny or cover up red flags in order to avoid economic or political penalties, but this approach can misfire.With tens of millions of workers now in quarantine and parts in short supply, China is struggling to get economic activity back on track. Countries with well-honed crisis risk-management arrangements are faring better at slowing the spread of infection, although that does not make them immune to political and economic pressures.COVID-19 has also shown how governance failures may involve inaction or over-zealous action by ill-prepared authorities scrambling to maintain or regain stability. Both ends of the spectrum undermine trust and cooperation among citizens and countries. Centralized control measures may seem necessary to stop or delay the spread of the virus, and compensate for weak individual and community resilience, but may also cause harm. Where a stringent policy response is deemed necessary, business will inevitably be impacted, with both near-term effects and less-expected longer-run consequences.Travel restrictions and quarantines affecting hundreds of millions of people have left Chinese factories short of labour and parts, disrupting just-in-time supply chains and triggering sales warnings across technology, automotive, consumer goods, pharmaceutical and other industries.Commodity prices have declined in response to a fall in China’s consumption of raw materials, and producers are considering cutting output.The mobility and work disruptions have led to marked declines in Chinese consumption, squeezing multinational companies in several sectors including aviation, education abroad, infrastructure, tourism, entertainment, hospitality, electronics, consumer and luxury goods.Forty-three out of 46 countries experienced a lower level of trade in goods. South Africa, India, Mexico, France and Italy are the five countries that suffered the highest reductions in trade volume. Unemployment is skyrocketing, while policymakers across countries race to implement fiscal and monetary measures to alleviate the financial burden on citizens and shore up economies under severe strain. The underlying cause of the economic slowdown is a global pandemic. The spread, and thus the economic impact of the virus, are highly unpredictable. But it affects people in all countries, states and localities to some degree. The pandemic also hurts almost all industries, turning the health care challenge into an economic one. Most of the economic disruptions affect the demand side. People can no longer go to work and often lose their jobs and incomes as businesses shutter their operations. Businesses are holding off on investments amid the growing uncertainty. And, exports will inevitably falter as other countries are taking similar actions to slow the spread of the virus. There will be some limited supply side effects. Businesses will fail as they lack customers and cash to sustain them for extended periods of time. Small and medium sized businesses, especially in low-margin industries, are ones most acutely hit by the economic fallout. Any economic intervention needs to primarily focus on boosting the demand side of the economy. This means replacing incomes, especially among lower-income and middle-income families.
It is obvious to everyone that the financial crisis is shaking the entire world, East and West. It is a serious event that is giving the politicians, decision makers, prominent thinkers and economist’s sleepless nights. It is a huge calamity that is very complex and has many implications, which explains the great turmoil being experienced by economists and politicians, and it also explains why so much is being written about it, analysing it from different points of view. They are in a state of great confusion, and some of them have started to blame one another for what has happened.
This crisis requires some explanation in order to highlight some important shar’i aspects that have to do with it.
The crisis is real
It has led to the collapse of major banks and financial institutions; international stock markets have declined, trillions of dollars have evaporated, billions have disappeared from the financial markets, many countries in the world have hit rock bottom, millions have lost their wealth, be it in the form of shares, savings or investments; the investments of the American people in the stock markets have lost $4 trillion. This crisis has become like a tsunami, striking the economies of many countries.
“the roof fell down upon them”
Economy and money are the main foundation of Western society, and when they were content with that and forsook the laws of Allah swt, “Allah swt struck at the foundation of their building, and then the roof fell down upon them, from above them, and the torment overtook them from directions they did not perceive” [al-Nahl 16:26].
What we are seeing today of large scale destruction is about to utterly destroy them. The economic structure that they boast about and think will protect them has become the cause of their turmoil and decline. The calamity has come to them from above and from below. They thought that their financial system was perfect but from that system has come that which they never expected. “and the torment overtook them from directions they did not perceive”.
“Say (to them), ‘It is from yourselves (because of your evil deeds)’” [Aal ‘Imraan 3:165]
Just as calamities and disasters have known, tangible causes, they also have spiritual causes. The fact that there are tangible causes does not contradict the fact that there are spiritual causes too.
Oppression, transgression, sin, disobedience to Allah swt and denying the rights of others are all causes of calamities befalling people at both individual and group levels, and even at the global level on occasion, as we are seeing in this crisis which involves calamities one after another.
“Evil (sins and disobedience to Allah swt) has appeared on land and sea because of what the hands of men have earned (by oppression and evil deeds)”
“And whatever of misfortune befalls you, it is because of what your hands have earned. And He pardons much”
In the saheeh hadeeth it says: “When zina (fornication, adultery) and riba (usury, interest) appear in a town, then they have brought the punishment of Allah swt upon themselves.” Narrated by al-Tabaraani in al-Kabeer and classed as saheeh by al-Albaani in Saheeh al-Jaami’ (679).
What has befallen the people is not a problem from heaven; rather it is a calamity that has befallen them because of their sin and what their own hands have wrought.
Allah swt gives respite but does not forget
He gave them respite whilst they were dealing in riba and consuming it doubled and multiplied (cf. Aal ‘Imraan 3:130) and waging war against Him for so many years, until He punished them with shortness of crops and destruction, as He did with Pharaoh and his people before: “And indeed We punished the people of Fir‘awn (Pharaoh) with years of drought and shortness of fruits (crops), that they might remember (take heed)” [al-A’raaf 7:130].
The Prophet Muhammad (blessings and peace of Allah swt be upon him) said: “Allah swt gives respite to the wrongdoer until, when He seizes him, He will not let him off.” Then he recited (interpretation of the meaning): “Such is the Seizure of your Lord when He seizes the (population of) towns while they are doing wrong. Verily, His Seizure is painful (and) severe” [Hood 11:102]. Agreed upon.
No one should think that Allah swt in His exaltedness, might and power is leaving these people to wrong others and rebel (disobey Allah swt) in the earth wrongfully ( Yoonus 10:23), disbelieving in Him and committing every major sin, then He will not send down His wrath and punishment.
The destiny of falsehood is to weaken and diminish: No matter how high it rises, there will come a day when it will inevitably be brought low. This is one of the laws of Allah swt that never changes. “It is Allah swt’s promise that nothing rises in this world but He will bring it down.” Al-Bukhaari, 2872.
The Westerners occupied the pinnacle of the global economy, and they said: “Who is stronger than us?” so Allah swt brought them down from their financial fortresses and citadels, and instilled fear in their hearts and exposed the falseness of their claims.
May Allah swt make things easy for us. Aameen firstname.lastname@example.org