Question

9. COVID-19 has the potential to re-shape the global economic order. Pick one issue-area covered by the course (e.g., trade policy, international reserve currency, MNCs, foreign aid, remittances, etc.) and explain how COVID-19 could alter the current situation. Be clear about what you expect to change and why, i.e., the causal mechanism that is expected to bring about that change. Also, be sure to use concepts and theories discussed in this course. Finally, stay focused as marks will be deducted if you discuss more than one issue-area. (30 points).

Answer 1

I am providing an opinion regarding the MNCs, please make sufficient changes according to the theories and concepts you have been taught.

The Covid-19 pandemic has scarred the world. It is life now completely unrecognisable in comparison to the freedoms we had a few short months ago. Whether Covid-19 triggers an economic crisis depends on the ability of industries to adapt to the new normal.
Lockdowns have restricted travel so those industries which have successfully digitalised are thriving. Whilst those businesses that are unable to do so are in danger of collapsing and bringing a significant chunk of the economy down with them.
In this global technocracy, almost everyone has access to a personal digital device. The limiting factor to successful digitalisation is therefore the industry rather than the public. So, the industries that will survive the Covid-19 crisis are those who either do not need to digitalise or can digitalise completely. For example, even the education system has fully digitalised. From kindergartens to universities; every educational institution is holding online classes. Some are even pre-recorded. Homework is submitted at the click of a button. This new system has resulted in cost savings and one wonders why this was not more common before.
The hospitality business has suffered as it can only partially digitalise. Sit-in restaurants are empty but online take-away services are booming. The role of tele-medicine in the healthcare sector is increasing for outpatient services. Some patients even prefer to have a consultation via telephone or video calls whilst sitting in their own homes. However, many people are unwell and need to be admitted to hospital. So, this sector can’t fully digitise.
Any sector in the economy that can digitalise will thrive under these conditions of the Covid-19 pandemic. Indeed, once the lock downs end these industries may remain fully online having realised the significant benefits of digitalisation. However, it is difficult to digitalise international travel. Furthermore, now that the world is more digitalised than ever before, we do not need to travel as much as we did before. So, it will be interesting to see what remains of the airline industry when the lock downs end.

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