The COVID-19 crisis is having a significant economic impact globally. There has been a severe halt in global economies, trickling down across a number of sectors. The result has shown loss to livelihoods for many facing already limited means of income. Due to lockdown measures taken to contain the virus, citizens are experiencing significant income losses and as the crisis continues, Sri Lanka, in particular, is expected to experience catastrophic shocks to the economy and the wellbeing of the population.
With people unable to go to work and businesses closing doors, workers in both the formal and informal sectors have seen cuts in wages if not complete loss of employment. The public health situation coming out of COVID-19, has also meant many workers are at risk of falling ill, further affecting their ability to work. As it stands, the World Bank has predicted an annual contraction of Sri Lanka’s economy of up to three per cent, the situation may worsen if the crisis continues for longer than expected.
Over the course of April to May 2020, Development Pathways worked closely with UNICEF Sri Lanka to analyse the economic fallout of predictions to the outcomes of COVID-19. Part of our approach included rapid assessment and modelling of the likely impact of the pandemic in addition to analysis of different social protection policy responses, including its costs. We looked to illuminate the effectiveness of alternative stimulus packages and the impact of what different social protection mechanisms can potentially have on the population of Sri Lanka.