Just a year ago, on March 16, I released a kind of editorial. Remember, colleagues? Coronaeconomics: The world will change, yet survive.
It was quite bold to make predictions about some emerging reality back then. At the time of the publication of that article, only 0.0015% of the world’s population was infected. But I still took a chance.
My article did not explore the medical aspects of the problem (and that turned out to be the right way — humanity has taken prompt action, and the ‘funeral tax’ the pandemic levied on earthlings was taken at a relatively low rate). Instead, I focused on the economy, government and the IT sector. Among other things, I predicted a “decline or even complete collapse of production of goods and services,” the “blockage, suspension and destruction of logistics chains,” and downfall and bankruptcy in a number of industries. And I will also take the liberty now to quote the conclusion from that article: “The world in general does not have any superpowers or super wisdom to find an optimal approach to <…> issues the new reality is giving us.”
I would like to take another chance now, and offer a new forecast. Even though I dislike such linguistic constructs, my new forecast happens to be quasi-conspiratorial. Why quasi? Because I do not believe in any conspiracy theories demonizing Bill Gates or another representative of a secretly emerging totalitarian world government as the mastermind and beneficiary of the pandemic. By the way, I’ll explain why I don’t believe it. According to conspiracy theorists, Gates had predicted the pandemic very subtly and accurately; at the same time he is someone who makes a product that should be in great demand during the pandemic. So there would seem to be a motive as well as circumstantial evidence.
Before actually moving on to my forecast, I will explain my standpoint on this issue. Predicting a trend is not a crime. Gates had probably bought up the best university brains from both hemispheres of the planet. With their intellectual help, along with the fastest computing devices he has at his disposal by virtue of his occupation, fed by high-quality Big Data, he is really in a better position than most of us to foresee the most probable scenarios of the future and adapt to them faster and more efficiently.
I’m afraid that accusations against him cannot be legitimate unless it can be proved that he could not resist using insider data from, say, government employees or healthcare providers.
Also, I find it extremely hard to agree with the claim that Gates or somebody else is the only beneficiary of the notorious chipization as a “pandemic business.”
True, the pandemic has made this statement from my article particularly relevant: “Person identification is now a blessing and salvation.” But this market is so undermonopolized and geopolitics is so non-linear that this may create an entire stratum of ‘new money’ in the anti-COVID tech industry. Each country will have its own newly rich so there won’t be just one person who will wake up wealthy. Kazakhstan has its own vaccine. More than 30 countries have registered the Russian vaccine. COVID-19 passport solutions by IBM and the company supported by the World Economic Forum are competing for markets with each other and dozens of other IT companies, from giants to startups and no-names. Forgive me but I don’t see how Gates could be motivated by excess profit (after all, the new market of COVID-19 compliance services that emerged from the pandemic proved to be clearly competitive) and I exonerate him virtually.
Then why is my prognosis conspiratorial, even if “quasi”? Well, because I see a market where, under certain circumstances, the new post-COVID reality promises both monopolization and extra bacon for the winner. Except something else, horrible and earth-shattering, will have to happen first.
No, not an epidemic. An epizootic.
We simply shifted focus a little bit — and immediately saw how a newly created imbalance may divide the world into losers (the majority), those completely wiped-out (individual economic entities, some industries and countries) and a small bunch of winners.
Countries rely on similar counter measures for epizootic response to that of epidemic, with one important exception: the main prevention method is stamping out not only sick animals but the entire livestock at a farm or even the entire population in the affected region.
During the COVID-19 epidemic, it was minks. An epizootic could leave the humankind without the entire or a significant part of food-producing livestock in just a few months.
Just think about it.
Meat producing countries’ national debt rates plunge.
Farmland value collapses.
Farms go broke. Their lenders go bankrupt.
Government aid for agricultural producers is typically late and not necessarily on point. Retraining livestock farmers? To do what?
It takes years to develop a cattle breed that is resistant to a specific disease.
Who will be small winners? Fish producers and meat producers working with the animals spared by the epizootic. Chip producers. Vaccine producers. Veterinary drug suppliers.
Who will hit the jackpot? Vegan meat, plant-based milk and alternative protein suppliers. Patent owners will set any “reasonable” price they want if there happens to be an overnight serious shortage of essential food. To my knowledge, the world’s agricultural market has been long oligopolized and this oligopoly is here to stay.
Since the first Western sanctions, Russia has achieved certain success in import substitution by setting a goal to ensure domestic food security. However, we need a new math, for the new reality may come with a different variety of available resources. Imagine predicting the availability of national fuel and energy resources based on the wild premise of the entire reserves of mazut or, say, black coal becoming instantly inaccessible. Wild premises of this kind have a chance of becoming reality tomorrow in the food market scenario I just described.
He who has ears to hear, let him hear. Or am I wrong?
By Artem Genkin
Doctor of Economics, Professor, President of the NPO “Center for Protection of Bank Clients and Investors”, founder of Invest Foresight