A criticality index for prioritizing economic sectors for post-crisis recovery in oleo-chemical industry

Abstract

Most countries have implemented lockdowns as the main non-pharmaceutical intervention in response to the global Covid-19 pandemic. Such actions have resulted in negative economic impacts on different sectors, which include manufacturing and processing industry. This concern has led to the need to develop post-lockdown “exit strategies” to mitigate the adverse socio-economic impacts. In this work, a systematic approach is developed to quantify the criticality of economic sectors based on a sector criticality index (SCI) and rank them based on their importance relative to the entire national economy. SCI is a weighted composite score based on five criteria which capture relevant dimensions in judging the importance of sectors: economic impact, connectivity, sector size, income multiplier, and employment. The input-output model is then used to evaluate the interaction amongst the economic sectors. The use of the proposed approach is illustrated with a case study focusing on evaluating the impact on oleo-chemical industries and associated agro-industrial sectors in Malaysia.