Essay on COVID-19 Travel Restrictions: US Defense Secretary Implements Changes

Introduction

The coronavirus pandemic led to the introduction of new restrictions on both domestic and international travel among airline industries to protect service members, employees, and family members from the deadly virus. Since the outbreak, several countries have signed memoranda to halt trade activities. For example, the US Department of Defense Secretary David L. Norquist signed a memorandum to stop all domestic travel in the US. The directive required the implementation of changes in both station and temporary duty travel, and the ban was to take effect from March 16, 2020, until May 11, 2020. Although these policies intend to prevent the spread of coronavirus, they have adversely impacted global business activities. The policy changes have resulted in the increased restriction of access to several market niches since countries such as China, Iran, Austria, Germany, Italy, etc. have been hard hit by the virus. Several diplomats and trade officials who have recently traveled to the affected areas have been forced to self-isolate for about 14 days before resuming their daily on-the-job activities.

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Discussion

Despite the COVID-19's worrying effects on human life, the pandemic has greatly impacted the global economy, and the Chinese economy has significantly slowed down over the last 3 months. International businesses have come to a standstill since the shutdown of the Chinese market, which is considered the central manufacturing hub for major global industries in operation worldwide. The disruption of the Chinese market has negatively impacted several sectors of the economy through regional and global value chains (United Nations, 2020, p.n.p). For example, policy changes have resulted in a significant decrease in the total output of the Chinese economy. Typically, China Manufacturing Purchasing Manager's Index (PMI) recorded a decline in its production capacity by 22 points I February after the critical production index felt the pinch of the pandemic. The declining index is a signal for the reduction in Chinese exports, and in the long run, the decline will be constant at 2% annually. The two percent observed in February can be analyzed in terms of a decline in the supply of intermediate goods (United Nations, 2020, p.n.p). The substantial reduction in Chinese exports has affected the global economy because most businesses overseas have run out of raw materials. In shanghai, there is increasing an increasing sipping capacity with a reduced demand for container vessels, as evident in its Containerized Freight Index.

COVID-19's outbreak has adversely impacted the global value chains. Over the recent past, China has recorded significant growth in its economy due to the country's status as a manufacturer and an exporter of consumer products. The Chinese market has been the major source of intermediate inputs that several manufacturing firms abroad rely on. Chinese manufacturing is vital to several value chains across the world since it is the source of many precision instruments, machinery, automotive, and even communication equipment. Therefore, the disruption in the Chinese market has halted the supply of several raw materials; hence, thwarting the growth of other sectors of the economy (United Nations, 2020, p.n.p). The new policies restricting the economic activities and the global movement of people and which aim to contain COVID-19 have hindered the supply of critical parts. As long as the Chinese producers are unable to supply their critical parts, it affects the country's output and that of the rest of the world.

Over 80 countries have imposed travel bans to curb the increasing spread of the new coronavirus. For instance, Germany closed its borders with Australia, Denmark, France, Luxembourg, and Switzerland temporarily to limit the spread of the new COVID-19. Several travelers have been turned away. Several abrupt policy implementations have taken effect all over the world immediately after declaring the COVID-19 outbreak a global emergency. Additionally, President Trump banned all arrivals into the US from 28 European countries, including Iran and China.

Similarly, Saudi Arabia has imposed a ban on international arrivals from more than 30 countries with Kenya banning arrivals from any country that has confirmed cases of COVID-19. Generally, over 80 countries worldwide have imposed travel ban and flight suspension to contain the deadly new coronavirus (The Economist, 2020, p.n.p). These policy changes have significantly impacted global trade and will soon culminate into gross economic devaluation that might even result in recession owing to the large number of countries impacted by the pandemic.

China is the first country that has felt the adverse impacts of COVID-19 due to the limited supply of intermediate inputs and an overall dwindling productive capacity. Countries whose economies rely on Chinese suppliers, as well as European auto manufactures, have faced critical components leading to the decreasing output. For instance, several Japanese companies have faced a shortage of parts necessary for the assembly of digital cameras. Therefore, lean and just-in-time manufacturing processes have compelled many companies to limit the use of their inventories. The situation will cripple production capabilities, including exports due to the exposure of market niches to the Chinese supply disruptions. The European Union will greatly feel the impacts in its machinery, automotive, and chemical industries.

Furthermore, the United States is currently experiencing shortages in machinery, automotive, and precision instruments, while Japan is faced with shortages in both machinery and automotive products (United Nations, 2020, p.n.p). The Republic of Korea has limited access to machinery and communication equipment, while the Taiwan Province of China is experiencing shortages in both communication equipment and office machinery. Lastly, Viet Nam is experiencing a shortage of communication equipment.

Furthermore, current legislation is focused on combating the systemic threat posed by the new coronavirus while ignoring cyber policies that can protect international business organizations from cybercrime. Many countries have experienced the importance of globalization, which is responsible for the expansion of business operations globally. The ease of communication and technological advancements has been possible due to globalization. However, the increasing number of deaths due to COVID-19 has twisted the focus of international business policies (Sharton, 2020, p.n.p). Therefore, superpower nations, including the United States, no longer focus on maintaining strict cyber policies that can maintain the superiority of their competitive positions and reduce the operating costs of their companies. This implies that several cybercriminals in every part of the market have decided to capitalize on the new pandemic since they have launched different types of "viruses." As some companies intend to work with only a few personnel on-site in most IT sectors, cybercriminals focus on sending phishing emails to employees to bring about another global crisis (Sharton, 2020, p.n.p). Business policies are currently focusing on travel bans rather than strengthening cyber legislation. Therefore, there has been a significant increase in the number of fraudulent invoices that purport to be from legitimate vendors and suppliers; hence, the increased risk of hacking accounts.

Solutions, with their advantages and disadvantages

The solutions to curb the adverse economic impacts of the new coronavirus are still based on international policies. Policymakers can counter the risk of the pandemic as quickly as possible and more constructively and effectively. One of the economic policy actions is not to harm. For example, the US must avoid attacking the paid leave and public health insurance programs that most of its citizens need at the verge of this pandemic (Vinelli, Weller, & Vijay, 2020, p.n.p). However, the country should instead implement policies that promote preparedness in the public health sector and initiate response strategies. The policies aimed at increasing the levels of preparedness should increase financial allocations to hospital departments to curb the increasing spread of emerging and zoonotic infectious diseases. Therefore, the legislation is crucial for its ability to improve public health with the long-term goals of minimizing harm, sustaining investments, and containing the outbreak (Vinelli, Weller, & Vijay, 2020, p.n.p). However, the key disadvantage of the policies that limit international trade is the declining interest rates in the financial markets. For example, the decrease in interest rates negatively affects mortgage rates and cut on federal rates due to reduced rates of buying houses with an ultimate increase in consumer debts, car loans, and credit cards.

The other key solution is the need by the federal government to strengthen the financial stability oversight to empower financial regulators who can monitor the ongoing impacts of the new coronavirus and restore the broader financial stability. The policy can rescue community banks in hard-hit areas and help them counteract their capital constraints and meet their local needs in business operation. The oversight team will discuss the risks associated with COVID-19 and recommend further strategies for containing the situation and reducing further spread. With proper oversight, several countries will strengthen their financial stability rules and reduce risk to the real economy. Conversely, the disadvantage of implementing this policy would be the supply chain disruptions and increasing global economic uncertainties (Vinelli, Weller, & Vijay, 2020, p.n.p). Confining business activities within domestic borders would result in the increasing amounts of debt that will leave little money for both businesses and households for expenditure following a drop in their incomes.

Conclusion and Recommended Strategy

In conclusion, as the spread of the coronavirus pandemic advances, it is necessary to increase international cooperation as regards the economic policy reviews, specifically financial policy, to stabilize the economy and international trade. Governments of various states should focus on coordinated responses to reduce the possibility of beggar-thy-neighbor legislation and accusations that can result in currency manipulation. However, various countries should strengthen international cooperation and coordination to aid in addressing the increasing stalemates surrounding the global supply chain, particularly in the supply of medicines.

References

Sharton, B., R. March 16, 2020. Harvard Business Review. Will Coronavirus Lead to More Cyber Attacks? Harvard Business Publishing. [Online].

The Economist. Mar 16th, 2020. The Economist. More than 80 countries have imposed travel bans to curb the new coronavirus. The Economist Newspaper Limited. [Online].

United Nations. 4 March 2020. Technical Note: Global trade impact of the Coronavirus (COVID-19) Epidemic. United Nations UNCTAD. [Online]. Available at: <https://unctad.org/en/PublicationsLibrary/ditcinf2020d1.pdf> [Accessed on March 17, 2020].

Vinelli, A., Weller, E., W., & Vijay, D. March 6, 2020. Center for American Progress. The Economic Impact of Coronavirus in the U.S. and Possible Economic Policy Responses. Center for American Progress. [Online]. Available at: &lt...