Consequences of coronavirus are becoming apparent
15 March 2020 - Cathy Xiao Chen

In Stockholm, the consequences of coronavirus are becoming apparent. As of March 14, the Ministry for Foreign Affairs has advised against non-essential travel to all countries, with the recommendation currently in place until April 14. The travel industry has so far been the hardest hit with Scandic laying off 2,000 employees and cutting management pay by 20 percent. On Sunday night, SAS Chief Rickard Gustafson announced that the Scandinavian airline would be terminating the employment of 10,000 employees – about 90 percent of their total workforce. Restaurants are also fighting for their survival with Stureplansgruppen – one of Sweden’s largest hospitality groups reporting dramatic losses and now facing a critical point in their history.

Other industries are also expected to feel the squeeze, with companies now expecting an economic downturn and cutting down on non-essential expenditure and recruitment. Casual employees and gig economy workers around the world are under pressure as some venues close temporarily due to the decline in demand. Businesses with manufacturing based in China were some of the first to be impacted as production stopped with the city of Wuhan and other surrounding cities in Hubei under lockdown since late January. Sverige’s Riksbank – Sweden’s Central Bank, has offered banks SEK 500 million at a zero interest rate to stimulate lending to companies operating in Sweden, but it will be up to the banks whether they pass on the zero interest rate.

Stockholm’s Blodcentral has also reported a sharp decline in blood donations in this past week, with people choosing to stay at home from fear of contracting the virus, according to Senior Doctor Maria Kvist. Many people are now choosing to work from home, which has led to a decline in revenue for service providers and other small businesses in areas that are experiencing lower than usual traffic. Demand for food delivery has soared in South Korea and the US has reported up to a twenty-fold increase in online food orders which may give an indication of trends to come in larger Swedish cities. And a large number of public events and gatherings have been canceled despite the government so far only banning events of 500 people or more.

In a recent press conference, Prime Minister Stefan Löfven said that every person in Sweden must be prepared to make sacrifices during this difficult period. Although Sweden will not close its borders at this time, the government will not shy away from taking decisive measures when necessary. It is not yet clear what measures the government is considering.

 

AUTHOR:

Cathy Xiao Chen is the Head of Operations at Impact Hub Stockholm. With a passion for supporting social impact, she advises and connects changemakers with collaborators to maximize impact.