The world’s middle-income economies have become the fastest growing group of countries in the past two decades, but their workers have been severely affected by the economic crisis caused by the coronavirus.
While government-mandated closures have blocked business activity in recent weeks, a generation of people who have grown up with high growth rates and rapidly increasing levels of education and health care face the worst financial challenge of their lives – with social protection systems more unequal and less generous than those of rich countries.
The economic turmoil that has led to record investment flows out of developing economies threatens the livelihoods of millions of people – but some are finding opportunities in disruption.
Harinath Singh and Sunita Devi
Uber driver, New Delhi, India
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Harinath Singh was worried when he returned home to his popular New Delhi neighborhood after a long day of driving on March 21 – the day before what was supposed to be a one-day “popular curfew”.
Many Uber drivers had already stopped working, but Mr. Singh – a former rickshaw driver who bought a car in 2016 to start driving for Uber – financially supports his wife Sunita Devi and two school-aged children, and has several loans to repay. His goal was to stay on the road.
But it should not be. Prime Minister Narendra Modi has imposed one of the strictest bans in the world, shutting down all public transport and taxi services.
These days, Mr. Singh, who emigrated to New Delhi two decades ago from the impoverished state of Uttar Pradesh, is trapped in his rented room apartment, playing doctor and patient with his eight year old girl worried about what’s in front.
“It’s good that the whole family is at home, we can eat all the meals together,” said Devi. “But my husband and I are very concerned about the loss of income. Living in isolation is so difficult for people like us who depend on daily wages. Our livelihood has been ripped off. “
With no real income since the lockout began, Mr. Singh – who spent up to 18 hours a day behind the wheel – used his savings to buy food. The family’s debts – including her monthly car payment of 15,000 rupees ($ 198) and loans for the marriage of her eldest daughter – weigh on her mind.
Uber distributed Rs3,000 to approximately 55,000 of its Indian drivers, including Mr. Singh. New Delhi also demanded that landlords not collect rent from tenants whose incomes have been affected. The Reserve Bank of India has ordered a three-month moratorium on debt repayment, such as Mr. Singh’s car loan.
But these measures are hardly reassuring; it predicts difficult times for several months, even if the foreclosure of New Delhi is eased as planned on May 3.
“People are very afraid to travel because of the coronavirus,” he said. “Even if the lockdown ends, business is bad.”
Fishmonger, São Paulo, Brazil
Alex Maia has a problem: he has “too many orders”.
For almost 20 years, the fishmonger has sold his products on the public markets of São Paulo, but last month the fairs were abandoned by customers concerned about the coronavirus.
For many feirantes, as the vendors are known, the pandemic has been a fatal blow to the small businesses they have run for decades. But Mr. Maia has started offering home delivery to the millions of self-quarantined people in Latin America’s largest city, and business is booming.
“I have 70 orders a day. With so many orders, our delivery system almost collapsed, “said the 35-year-old.
“They buy fresh produce at home and can pay in different ways,” he added, alluding to the rise of new payment platforms now available in Brazil.
But Mr. Maia’s new business model is still vulnerable to the pandemic. The feirantes depend not only on their suppliers, but on the Brazilian army of truckers who transport most of the country’s goods.
These drivers are now openly discussing a strike action to protest the current conditions, including the closure of bus stations and garages.
Brazilian government ministers have pledged that the country will not face food shortages as long as truckers continue to move. But Mr. Maia is already seeing worrying signs.
“Some products are missing,” he said. “So now I speak directly to the fishermen [to source food]. ”
Salon owner, Bangkok, Thailand
The Shewa Spa is located in the midst of bars and hostels in Bangkok’s Khaosan Road area, normally the pulsating heart of the tourist life of the city.
But a six-week lockout emptied Khaosan of visitors. This has flattened the curve for new coronavirus infections, which means authorities can start to allow companies to reopen, but it may be too late to save Shewa, the hair, nail and massage salon from Shewa, Mariwan Jintawijit.
“Now the disease is decreasing, but the business is going to die,” said Mariwan.
The Thai government announced this week a partial lifting of the lockdown from May 3, but with strict decrees on which companies can open and what they can and cannot do. Hairdressers can cut and dry hair, for example, but coloring is prohibited and they must close every two hours for cleaning. Manicures and massages are prohibited. Social distancing must be maintained.
“I have four chairs,” said Mariwan, pointing to her hair salon as she calculated the distance between them and how much her hairdressers could make. “Are we two, three or one [client]? “
She also doubts that many customers will return, with most international flights being nailed down until at least mid-May.
Its location is typical of many people in Bangkok, who live in the footsteps of foreign visitors.
Ms. Mariwan’s 50 employees and casual workers, many of whom are migrants from poor northeastern Thailand, often cut their nails and hair on Europeans and Americans or massage their feet. Most optimistic Bangkok residents hope long-haul tourists could return in high season at the end of the year, although Chinese visitors may return earlier.
Meanwhile, she asked for a government-sponsored Covid-19 wage cut for 10 of its employees, which has yet to arrive, and a government-supported loan for the company.
In 22 years running her business, Ms. Mariwan repeatedly saw political fights in the streets outside her store and catastrophic floods in 2011, but that, she said, was worse.
“When we had the yellow shirts and the red shirts [fighting], I could still stay open and have money to pay the rent; even during the floods, “she said. “Now I have zero. “
Oke Olumide Victor
Tailor, Lagos, Nigeria
Nigerian weddings are flashy affairs, filled with matching caftans and traditional dresses, and until recently, they were an essential part of the business of tailor Oke Olumide Victor.
But the coronavirus has wiped them out – including its own, slated for last month – as well as all of its consultations and scheduled in-person installations in Lagos, Nigeria’s commercial capital.
Many customers have canceled orders and he has had to charge double the regular rates to the few who have placed new ones; most of its materials are imported from China and prices have skyrocketed after Beijing imposed severe closures.
For the first time since he started his business three years ago, Mr. Victor has not made any money for three full weeks. One of his six employees resigned, dissatisfied with the half salary he offered; the other five, among the many 21 million people who live in Lagos on a daily basis, barely manage.
Mr. Victor is also having difficulties.
“My ultimate fear is that, after the foreclosure is over, it takes a while for the business to start because people will want to pay off their debts and get the money they had to take from other regions to survive this period” , did he declare.
But then he got a glimmer of good news: a former customer reached out and asked him to make 100 custom masks. The customer, a retailer, wants fashionable masks that people can wear to match their outfits – the kind that Mr. Victor usually designs.
“At this point, food and shelter are all we need and this job will allow us to do that,” said Victor.
Fatih and Fatma Kavraal
Hotel workers, Antalya, Turkey
Fatih Kavraal only worked six days this year before being sent on leave without pay. Like many in the Turkish city of Antalya on the Mediterranean coast, it depends on seasonal employment in the thousands of large hotels in the region.
Normally, the sun loungers would now start to fill up with European vacationers, bringing in billions of dollars in foreign exchange earnings that are vital to the Turkish economy. But now all international flights to the country have been cut, and the hotel where Mr. Kavraal was scheduled to work for the summer as a chef is closed.
The 27-year-old is newly married and he and his wife Fatma – who has also been on leave without pay from work in hotel security – are worried about mortgage payments and other bills that are going up at around 3,500 TL (about $ 500) each month.
“If I worked, I could afford it by myself,” he said. “But now, every month I don’t work, I’m going to take around 3,500 TL. Instead of saving, you go into debt. “
Tourism directly represented 4.8% of Turkey’s gross domestic product in 2018 and the industry supports a multitude of other sectors, particularly in a region like Antalya, which welcomed 14.7 million foreign visitors the year last. Kavraal looked for other jobs in the city, but to no avail.
He is waiting to see if he will be eligible for a new payment for workers on leave worth 1,170 TL ($ 167) per month, the equivalent of half the minimum wage.
He managed to get a 3,000 TL loan from a state bank, but it was less than a third of what he hoped for. Like many in Turkey, he relies on his family: his in-laws have given him money. “They don’t have a lot of money either, but they are trying to share it with us,” he said.
The Kavraals are struggling to reconcile their hopes for their first year of marriage with reality. They planned to use part of their summer season income for fun; instead, they are stuck at home, wondering how to make ends meet. “Our morale is not good,” he said.
Report by Jyotsna Singh, Amy Kazmin, Bryan Harris, John Reed, Neil Munshi and Laura Pitel