The Pandemic Dilemma: Recession or Contagion?

Contain the Virus, Then Restart the Economy
fnf korea

When is the right time to ease off pandemic restrictions and reopen the economy?

Liberal and democratic political leaders from Asia and Europe pointed out that there is no easy answer to this question because countries are at different stages of containing COVID-19.

“We need to have the right strategy in terms of balancing”, said Abhisit Vejjajiva, former Thai prime minister and former chairperson of the Council of Asian Liberals and Democrats (CALD). “I think there is only one objective – to manage the situation in our countries to make sure that there is sustainable well-being for all of our people. And to do that, we have to make sure that we get on top of the contagion. We can never restart the economy if the contagion continues.”

Abhisit made the observation in the webinar, “The Pandemic Dilemma: Recession or Contagion?” organized by CALD in close cooperation with the Alliance of Liberals and Democrats for Europe (ALDE) Party and Friedrich Naumann Foundation for Freedom (FNF) Korea Office. Held on 2 June 2020, and ably moderated by CALD Individual Member Emily Lau of Hong Kong, the event was livestreamed in Asia and Europe via the Facebook pages of the organizers. A link to the webinar can be found here.

The webinar examined, in particular, the experiences of South Korea, Sweden and Germany in balancing the need to restart the economy severely devastated by various forms of lockdowns, with the necessity of containing the virus and protecting public health.

Cho Jung-hoon, a newly-elected member of the South Korean National Assembly, summarized his country’s experience in dealing with COVID-19 into three principles: 1) resilience; 2) openness; and 3) comprehensiveness. On the key question of the webinar, he responded: “We are now trying to adjust the balance between a complete lockdown — which will have a great cost in terms of the economy — and public health. Although (here), there is no magic bullet, there is no magic ratio. It depends on each country’s situation.” He then shared his reflections on how the pandemic would impact on the roles of government, on globalization, and on society in general, noting that as what can be seen in the United States, “…a pandemic like coronavirus can trigger not only a public health crisis but also a social and economic crisis.”

Sweden, like most countries in the world, is also experiencing an economic contraction due to the pandemic, having been dependent on open markets and international trade. Swedish Member of European Parliament, Abir al-Sahlani, who presented her country’s pandemic response, opined that Sweden’s strategy is not based on achieving “herd immunity” as reported, but on reliance to “the people’s own sense of duty and responsibility.”

Describing the current situation as a marathon rather than a sprint, she observed: “It is difficult and exhausting for people to give up their freedoms for a long period of time… I do think it is wiser to save the very harsh measures for peak periods, and to allow people to maintain most of their civil liberties for as long as possible, provided it is safe to do so.”

Germany’s response to the coronavirus was described by FNF Chairman, Prof. Karl-Heinz Paqué, as divided into three phases: 1) Disaster (January-mid March); 2) Lockdown (mid March-early May); and 3) “Smart Safety” (early May to present). Smart Safety is described as a highly regulated reopening characterized by strict minimal distance requirements and obligatory social practices such as wearing of masks. He noted that the success of Germany’s third phase is not yet certain, and a second wave of cases could still come, but the situation, thus far, looks promising from a medical standpoint.

At the global and regional level, Prof. Paqué argued that liberals and democrats should state clearly that they would like to go back to a globalized world economically, but it should be “safe globalization”, characterized by appropriate flexibility to react to unusual and dangerous circumstances such as a pandemic.

During this time, Liberals and Democrats should also continue to work together in the spirit of international cooperation and exchange. As Head of FNF Korea, Christian Taaks, said: “Most of the keys to the solution for the multiple, existing and upcoming challenges of the COVID-19 context is exchange, cooperation and the preparedness for mutual learning and support. There won’t be a single-country solution anywhere.”

Similarly, ALDE Party President Hans van Baalen proposed: “We as a liberal family need to provide ideas, suggestions and we have to work together, and I am proud that we are doing so… We liberals have to fight because we are all in this together — for surviving as a world economy, for surviving as a world community.”