Abstract
Countries have sought to stop the spread of coronavirus disease 2019 (COVID-19) by severely restricting travel and in-person commercial activities. Here, we analyse the supply-chain effects of a set of idealized lockdown scenarios, using the latest global trade modelling framework. We find that supply-chain losses that are related to initial COVID-19 lockdowns are largely dependent on the number of countries imposing restrictions and that losses are more sensitive to the duration of a lockdown than its strictness. However, a longer containment that can eradicate the disease imposes a smaller loss than shorter ones. Earlier, stricter and shorter lockdowns can minimize overall losses. A 'go-slow' approach to lifting restrictions may reduce overall damages if it avoids the need for further lockdowns. Regardless of the strategy, the complexity of global supply chains will magnify losses beyond the direct effects of COVID-19. Thus, pandemic control is a public good that requires collective efforts and support to lower-capacity countries.
Highlights
COVID-19, which is caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), emerged in late December 2019, but quickly spread to other countries[1] in Asia, Europe and North America and was declared a pandemic by the World Health Organization (WHO) on 11 March 2020
Note that our model is distinct from computable general equilibrium (CGE) models in that it is designed to assess economic impacts in response to disasters that unfold over weeks or months, before production structures and trade networks have time to adjust to new production patterns
The panels in the left column (Fig. 1a,d,g,j) show the supply-chain effects if COVID-19 had been successfully contained to only China; the panels in the middle column (Fig. 1b,e,h,k) show the impact if COVID-19 had spread from China to Europe and the United States, which had implemented lockdowns, but no further; and the panels in the right column (Fig. 1c,f,i,l) show the impact when the virus spreads globally and all of the remaining countries implemented containment measures
Summary
COVID-19, which is caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), emerged in late December 2019, but quickly spread to other countries[1] in Asia, Europe and North America and was declared a pandemic by the World Health Organization (WHO) on 11 March 2020 (ref. 2). We modelled the short-term economic shocks of different COVID-19 response scenarios as sector-specific transportation and labour supply constraints. Sector-specific constraints on labour availability are determined by both the strictness of lockdown measures represented in the scenario (for example, 80% strictness will reduce overall transportation capacity by 80%) and the sector-specific multipliers (for example, 0.5 for wheat production as the level of exposure is low and 0.1 for electricity and gas supply as essential activities; see Methods). Each of the 39 scenarios is based on a different combination of spatial spread, duration and strictness; the results are presented in terms of economic supply-chain effects, measured in absolute terms of loss in value added (for example, billions of US dollars) or relative terms (as a percentage of pre-pandemic value added)
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