{"id":100877,"date":"2020-04-07T16:13:33","date_gmt":"2020-04-07T23:13:33","guid":{"rendered":"http:\/\/www.lankaweb.com\/news\/items\/?p=100877"},"modified":"2020-04-07T16:13:33","modified_gmt":"2020-04-07T23:13:33","slug":"managing-systemic-risks-during-pandemic","status":"publish","type":"post","link":"https:\/\/www.lankaweb.com\/news\/items\/2020\/04\/07\/managing-systemic-risks-during-pandemic\/","title":{"rendered":"Managing Systemic Risks During Pandemic"},"content":{"rendered":"

by Asanga Abeyagoonasekera*<\/em><\/span><\/h2>\n\n\n

The oldest form of systemic risk, which is that arising from viruses and pandemics\u201d<\/em> \u00a0Ian Goldin & Mike Mariathasan, The Butterfly Defect (Princeton 2014)<\/em><\/p>\n\n\n\n

\u2018Pain\nof one nation is the pain of another; as we are all interconnected\u2019 was the opening\nsentence of  my 2015 book \u2018Towards<\/em><\/a> a better world order\u2019<\/em><\/a>. We are experiencing this today as the collective pain\nof humanity.<\/p>\n\n\n\n

Geopolitics and Interdependence<\/em><\/strong><\/p>\n\n\n\n

Pandemics\nhave no respect for borders nor individual social status. Pandemics killed\nworld leaders including Pharaoh Ramses V of Egypt, Emperor Marcus Aurelius of\nRome, Ferdinand IV of Spain, Emperor Fu-Lin of China, Queen Mary II of England,\nKing William II of Orange, Tsar Peter II of Russia, and King Louis XV of\nFrance. In the present context Coronavirus (COVID-19) has infected close to a\nmillion including the British Prime Minister. Pandemics can infect anyone\nanywhere.  <\/p>\n\n\n\n

The\n21st<\/sup> Century has faced four pandemics. The first case was in\nFebruary 2003 as SARS was reported in Guangdong province in China. SARS spread\nin four months to 26 countries with 774 deaths and 8000 cases. The second was\nthe H5N1 Bird Flu triggered in 1997 during a poultry outbreak in Hong Kong. The\nthird near pandemic was H1N1 Swine Flu which emerged in April 2009 in Mexico\nCity and New York spreading to 30 countries in weeks. Unlike the previous two,\nthe Swine Flu pathogen originated in the West rather than in the East Asian\nprovinces. This was a clear early warning to how dangerous supercities and\nairport hubs can be in terms of health risks- it was a warning ignored. The\nvirulence and severity of H1N1 influenza killed 570,000[iii]<\/a>. The fourth is the Coronavirus that has<\/strong>\nkilled more than 40,000 people around the world as of 2nd<\/sup>\nApril according to WHO.<\/strong><\/p>\n\n\n\n

Larry\nKlayman [i]<\/a> , a\nformer federal prosecutor under the administration of President Ronald Reagan,\nsaid in an interview that he was willing to work with Sri Lankans and others to\nbuild international pressure on China. He was accusing China that the novel\ncoronavirus was designed  to be a\nbiological weapon of war\u2026 creation and release, accidental or otherwise, of a\nvariation of coronavirus known as COVID-19 by the People’s Republic of China\nand its agencies and officials as a biological weapon in violation of China’s\nagreements under international treaties, and recklessly or otherwise allowing\nits release from the Wuhan Institute of Virology into the city of Wuhan\u201d. These\nare baseless allegations. It will create geopolitical tensions and disunity at\na time of human distress.<\/p>\n\n\n\n

 One may wonder who was behind or which nation\nreleased the past outbreaks in our human history? It is a time for\ntrans-national cooperation and coordination since national governments alone\nwill not be able to manage the magnitude of this global challenge. While the\nexchange of physical goods and services will be reduced due to the Pandemic you\ncannot halt the globalization and the globalized interdependent world we have\ncreated. According to Robert Keohane and Joseph Nye, \u2018complex interdependencies[ii]<\/a> is what the world has experienced during the past\nfew decades. If managed insufficiently will lead us to overly complex\ninterdependencies and will trigger systemic risks such as the present Pandemic.<\/p>\n\n\n\n

Interdependence\nin such times is evident even from the past. One of the first epidemics in the\nrecorded history which started in Athens in 430 BC did not start in Athens but\nin Ethiopia and travelled to Egypt and then to Athens. Spanish Flu did not\nstart in Spain, Spain was open to reporting the cases. Globalisation is not a\nnew phenomenon. It has transported pathogens to many nations. The Spanish Flu\nin 1918 came in three increasingly deadly waves with nine months intervals\nbetween them, killing 50 to 100million people worldwide. This deadly outbreak\nkilled 17 million in India alone. <\/p>\n\n\n\n

Butterfly Effect to Butterfly Defect <\/em><\/strong><\/p>\n\n\n\n

 American mathematician Edward Lorenz[iv]<\/a> work in Chaos theory which found the \u2018Butterfly Effect<\/em>\u2019,\nexplaining how a hurricane formation is influenced by minor perturbations such as\nflapping of the wings of a distant butterfly several weeks earlier. A small\nchange in one place can lead to major differences in a remote area. In the same\nmanner negative unintended ripple effects of Coronavirus that triggered in\nWuhan ended up affecting many nations including Iran, Italy, Spain and USA currently\nholding the highest infected cases. <\/p>\n\n\n\n

I\nwas introduced to the concept of  the \u2018Butterfly<\/em><\/a> Defect\u2019<\/em><\/a> <\/em>by Prof Ian\nGoldin at the University of Oxford[v]<\/a>. It is a\nremarkable work of scholarship co-authored with Mike Mariathasan and published\nby Princeton University which predicted in 2014 that the next financial crisis\nwill arise from a Pandemic. His book examines how globalization creates\nsystemic risks from<\/p>\n\n\n\n

micro\ndistresses from the closely-knit systems and connections we have built and the\nimportance of significant investment in mitigating the risk factors arising\nfrom such a system. <\/p>\n\n\n\n

Prof\nGoldin explains, \u2018Systemic risks cannot be removed because it is endemic to\nglobalization. It is a process to be managed, not a problem to be solved\u2019. Out\nof the risks, he identified Pandemics and the health risk from Globalization.\nWhat triggered in Wuhan ended up in so many countries so fast due to\nglobalization. Despite the immense health benefits we have felt from\nglobalization, world health officials did not identify the systemic risk from a\nPandemic such as Coronavirus. According to Goldin and Mariathasan\n\u2018Globalization, population growth, and urbanization have facilitated the\ntransmission of infectious diseases. The complexity of Global travel and global\nintegration any patient zero is now but a few degrees of separation from\nformerly isolated communities\u2019 was clear from the present Pandemic we all are\nfacing. There are three lessons to be learned for systemic thinking regarding\nthe health risks arising from globalization according to Prof.Goldin. First, to\nidentify risks, mechanisms for early detection are essential. Second, once a\npandemic is detected mechanisms for early response must be enacted. Third,\nsystemic risks require systemic responses. The COVID-19 was picked up too late,\nthe communication was late and systemic responses to fix was late. This is a\nwake-up call to WHO and global leaders.<\/p>\n\n\n\n

Multilateralism during Pandemic<\/em><\/strong><\/p>\n\n\n\n

While\nnational borders are shut, each nation has adopted their way of containing the\nCoronavirus. After Italy\u2019s death rate, all of Europe was on Curfew and\nlockdown. According to Judy Dempsey, Senior fellow at Carnegie Europe \u2018Whenever\nthere is a crisis, European Union leaders have the habit of saying that the\nbloc will emerge stronger. They have been repeatedly<\/p>\n\n\n\n

disproved\nof this slogan, which has lost all meaning[vi]<\/a>.\u2019 <\/p>\n\n\n\n

The\nimportance of Multilateralism is discussed from Europe to South Asia where\nleaders have dismantled multilateral organisations such as SAARC in the past is\nnow finding ways of discussing activating health funds and strengthening\nregional cooperation. The ultra-nationalist narrative is weakened by the\nPandemic showing a direction towards cooperation and promoting multilateral\nefforts are the only way forwards. Ambassador Rajiv Bhatia who is a\nDistinguished Fellow from Gateway House identified four main points which is\nrelevant and timely. First, COVID-19 is a global challenge and needs to be\naddressed on a national and international level. Second, The Government of\nIndia has been studying the approach of affected countries and assimilating elements\nthat apply to India in its strategy of containment. Third, India is adopting a\nsober view vis-\u00e0-vis China, maintaining a constructive spirit, sending\nassistance where required \u2013 rather than falling prey to disputes \u2013 as the\npandemic has affected all of mankind. Finally, Prime Minister Modi is proactively\ninitiating multilateral cooperation through the South Asian Association of\nRegional Cooperation (SAARC) and G20. Appreciating the multilateral directive\ntaken by \u2018Prime Minister Modi\u2019s prompt convening of a video summit of SAARC\ncountries for a more coordinated containment response to the pandemic was,\ntherefore, a bold diplomatic step: other countries are now replicating this in\ncombating the geopolitical, economic and health dimensions of the disease\u2019[vii]<\/a>. <\/p>\n\n\n\n

At\nthe video conference as a blanket security measure, PM Modi pledged\nUS$10million while Sri Lankan President Gotabaya Rajapaksa contributed US$5\nmillion the second-highest contribution from South Asia even at a time when Sri\nLankan economy is the lowest-performing in the region. Sri Lanka\u2019s  exports and tourism sector have been affected\nby multiple risk factors starting from the  Easter Sunday terror attack in April 2019. <\/p>\n\n\n\n

A\ntwice slapped economy from Easter attack and Pandemic- Sri Lanka will need to\nnavigate a global recession this year. Hopefully, another wave of the Pandemic\nwill not trigger in the coming months. While developed nations such as\nSingapore will prepare for the next several waves the developing countries with\ntheir squeezed health budgets will find its limitation in facing the next\nseveral waves of the Pandemic if it triggers. <\/p>\n\n\n\n

Local to Global leadership to manage systemic risks<\/em><\/strong><\/p>\n\n\n\n

Sri\nLankan authorities started taking strict measures to contain and manage the\nvirus from 19th March, after soft-pedalling until election nominations were\nsubmitted for the upcoming Parliament election. As explained by  <\/strong>S.\nRatnajeevan H. Hoole<\/a> member of\nthe election commission, \u2018Mr. Deshapriya was insisting that April 25 is\npossible. It seemed that he was afraid to disagree with the President. Here is\nthe strategy that was finally agreed upon. It was decided to accept nominations\nas announced, and then gazette the names of candidates and polling booths as\nrequired in Section 24(1) of the Parliamentary Elections Act of 1981……The\ncountry is functioning with Votes on Account without a Parliament\u2019 [viii]<\/a>.<\/p>\n\n\n\n

If\nwe had the Parliament functioning, we would have many stakeholders including\nthe opposition discussing the mitigating strategy and perhaps would be able to\nrecalibrate a better strategy than the curfew in place. How long does the\nGovernment wish to continue the Curfew strategy? What are the short and long-term\nimpacts to the economy from a lockdown or curfew strategy? Importance of a\nmitigating strategy rather than a suppression(curfew) strategy? How do we\nprotect the elder community the most vulnerable? How can we sustain as a nation\nif there are multiple waves of the Pandemic in the future? How do we have\nbetter sustainable debt management practices during and post Pandemic? Are some\ncritical questions that could have been discussed in the Parliament by enabling\nand echoing multiple expert stakeholder advice from our society. <\/p>\n\n\n\n

The\nnumber of infected cases exceeded 100, at 143 by 31st<\/sup> March and\ncurfew has been declared with the international airport shut. Sri Lankan\ncitizenry is now aware of the significant threat while some senseless politicians\nstarted distributing face masks in public for popularity and certain\nindividuals violating curfew laws, what people should understand is the effort\ntaken by the authorities to bring the numbers down. People typically think of a\nlinear sequence such as 2,4,6,8,10.. of growth but Coronavirus has a slow\nexponential growth rate 2,4,8,16,32,64..which needs to be understood by the\npublic. Human beings are social creatures who admire to group in packs and\ncrowds naturally rejecting social distancing would have to practice against\ntheir natural behaviour especially in the month of April where they get-together\nfor Easter falling on 12th April, followed by Sinhalese and Tamil New Year in\nSri Lanka and on 23rd April Ramadan. It is the first time in century every\nfaith will be practised in isolation and quarantine. Practicing social\ndistancing and the quick adaptation of the polity towards best practices will\nbe a key factor for the success to bring down the curve of the outbreak in the\nIsland.<\/p>\n\n\n\n

Sri\nLanka is far behind testing when compared to nations like Australia as compared\nby a Sri Lankan medical Dr Ravi P. Rannan-Eliya, Sri Lanka has done nearly 2280 tests as of 30th March\nand of these tests, 115 persons were positive which is 5.5% of tested cases\nfound positive. \u2018This is a relatively high rate compared to other countries\nsuch as Australia which has a population similar to ours has done 160,000 tests\nand found 3,966 positive cases\u2013 positive case rate 2.47%\u2019 [ix]<\/a>. Sri Lanka and many South Asian nations need to get the\ntesting capacity increased to efficiently manage the spread of the outbreak,\ncurfew and lockdown alone will not help.<\/p>\n\n\n\n

While\nwe suppress and manage the local threat we must prepare for the next wave or several\nwaves of the Pandemic. Due to complex interdependencies of the global arena\ntriggering systemic risks to our Island nation it\u2019s time we prepare for such\nrisks. The transition of the political environment from pre-pandemic to post-pandemic\nwill require the national leaders who were inward-looking with their ultra-nationalist\nand populist agenda to move away to a global and multilateral agenda and\nunderstand the complex systemic risks we face. Not only the top leadership the\nnext lot of Parliamentarians who will be elected in few months would need to\nunderstand that \u2018we could harvest the benefits of globalization while building\nresilience and mitigating against the inevitable interdependency and vulnerability\narising from increased connectivity and complexity\u2019[x]<\/a> .<\/p>\n\n\n\n

The\nworld we live has its complex interdependencies due to globalization. Managing\nthese interdependencies is the key challenge which will get us ahead of the\ncurve. Most leaders found a direction towards confining their focus and energy\nto local issues more than addressing global challenges to create a sustainable\nenvironment. It’s time to rediscover ourselves while nature is reset. While industrialists\nmourn, wildlife will be left in peace.  Was this a lesson to the fragmented human\nrace?<\/p>\n\n\n\n

End Notes<\/strong><\/p>\n\n\n\n

 [i]<\/strong><\/a> Klayman,\nSri Lanka must ensure China is held accountable:US Lawyer<\/p>\n\n\n\n

\nhttp:\/\/www.dailymirror.lk\/hard-talk\/Sri-Lanka-must-ensure-China-is-held-accountableUS-Lawyer\/334-185719\n<\/div><\/figure>\n\n\n\n

[ii]<\/a> Keohane and Nye, 1977, Power and Interdependence:\nworld politics in transition<\/p>\n\n\n\n

[iii]<\/a> Jonathan Lynn,2010, https:\/\/www.reuters.com\/article\/us-flu-who\/who-to-review-its-handling-of-h1n1-flu-pandemic-idUSTRE5BL2ZT20100112<\/p>\n\n\n\n

[iv]<\/a> Lorenz,1963,\u201dDeterministic<\/p>\n\n\n\n

Nonperiodic\nFlow\u201d, Journal of the Atmosphearic Sciences 20(2):130-141<\/p>\n\n\n\n

[v]<\/a> Goldin, https:\/\/press.princeton.edu\/books\/hardcover\/9780691154701\/the-butterfly-defect<\/p>\n\n\n\n

[vi]<\/a> Judy Dempsey Carnegie Europe, https:\/\/carnegieeurope.eu\/strategiceurope\/81352<\/p>\n\n\n\n

[vii]<\/a> Rajiv Bhatia Gateway House, https:\/\/www.gatewayhouse.in<\/a><\/p>\n\n\n\n

[viii]<\/a> Hoole, Democracy In Crisis: Avoiding\nDictatorship,https:\/\/www.colombotelegraph.com\/index.php\/democracy-in-crisis-avoiding-dictatorship\/?fbclid=IwAR2K2nKiIA-BHblxYwIKLpDT7_HdEaRFfaqs-VGYrMATbBjXB4e3I5C7mr8<\/p>\n\n\n\n

[ix]Dr\nRavi P. Rannan-Eliya,\nDaily Mirror, <\/p>\n\n\n\n

http:\/\/www.dailymirror.lk\/news-features\/Sri-Lanka-needs-rapid-expansion-of-testing\/131-185909<\/a><\/p>\n\n\n\n

[x]Goldin,https:\/\/press.princeton.edu\/books\/hardcover\/9780691154701\/the-butterfly-defect<\/p>\n\n\n\n

*Asanga Abeyagoonasekera <\/em>is an alumnus of the NESA Center, National Defense\nUniversity, Washington DC, USA. He <\/em>studied \u2018Butterfly Defect\u2019<\/strong>\nunder Professor Ian Goldin at Oxford University.<\/em><\/em><\/h5>\n\n\n\n
Asanga\nis the author of \u2018Sri Lanka at Crossroads(WorldScientific,Singapore). He was\nthe former Director General at the national security think tank(INSSSL) under\nMinistry of Defence and former Executive Director at the foreign policy think\ntank(LKIIRSS) under Ministry of Foreign Affairs Sri Lanka. He can be contacted\nat <\/em>asangaaa@gmail.com<\/em><\/a> <\/em>The article was initially published by NESA Center Department of Defence\nWashingtonDC.<\/em><\/em><\/h5>\n","protected":false},"excerpt":{"rendered":"

by Asanga Abeyagoonasekera* The oldest form of systemic risk, which is that arising from viruses and pandemics\u201d \u00a0Ian Goldin & Mike Mariathasan, The Butterfly Defect (Princeton 2014) \u2018Pain of one nation is the pain of another; as we are all interconnected\u2019 was the opening sentence of  my 2015 book \u2018Towards a better world order\u2019. We are […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":true,"template":"","format":"standard","meta":{"footnotes":""},"categories":[164],"tags":[],"class_list":["post-100877","post","type-post","status-publish","format-standard","hentry","category-asanga-abeyagoonasekera"],"_links":{"self":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/100877","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/comments?post=100877"}],"version-history":[{"count":0,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/posts\/100877\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/media?parent=100877"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/categories?post=100877"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.lankaweb.com\/news\/items\/wp-json\/wp\/v2\/tags?post=100877"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}