disease outbreaks. The shock of this pandemic needs not only demand management but also the combination of monetary, fiscal and health policy responses. Therefore, there is a critical role for the government to ease real and financial stress. Quarantine and social distance measures also work to reduce the spread of viruses. Maintaining better hygiene practices is highly effective with a low cost (Levine and McKibbin 2020). In the long term, global cooperation is necessary to strengthen public health and economic development as the pandemic can kill many people in any society if those diseases are generated in poor countries due to overcrowding, poor public health and interaction with wild animals. Consequently, public investment in health is crucial to improve the quality of life as a driver of economic growth.

New firm-level evidence on the impact of COVID-19 on sales and employment by the World Bank’s Business Pulse Surveys (BPS)<sup>10</sup> shows that firm sales dropped by 32 percent among highincome countries and by 48 percent among low- and middle-income countries. The decline in sales amid the pandemic varied widely across countries, sectors of economic activity and firm size. For instance, South Africa, Bangladesh, Nepal, Honduras, India and Jordan registered an average drop in sales that exceed 60 percent. Across sectors, firm activity in tourism as well as businesses that require face-to-face interactions were the most affected by the pandemic.<sup>11</sup>

# **3. COVID-19 in Developing Countries**

The COVID-19 pandemic has spread rapidly across the world, taking a human toll of nearly five million fatalities among the more than 240 million confirmed cases across 210 countries and territories.<sup>12</sup> As of mid-October, North America and South America have the largest number of infections by the COVID-19 pandemic, with 46 million and 45.5 million cases, followed by Western Europe and South Asia (38.4 million and 38.3 million cases), and Eastern Europe and Central Asia (33 million). Surprisingly, Sub-Saharan Africa has registered a low number of COVID-19 cases relative to most developing areas in the world since the pandemic started —about 5.9 million cases, which represent 2.5 percent of the infections worldwide.

After a rapid increase in the number of COVID-19 confirmed cases across the world during the second quarter of 2020, a series of containment measures (including restrictions on domestic and international movement, lockdowns, and social distancing) were rapidly implemented across countries —although with different degrees of stringency and effectiveness. These measures were aimed at limiting the spread of the virus and alleviating the pressure on weak health systems. Lockdown measures have led to a sharp drop in economic activity in all countries/regions of the world —particularly, in the second quarter of 2020. The stringency of the containment measures reached their peak when the infection and death rates were rapidly increasing across developing

> 10 The Business Pulse Surveys (BPS) is a globally harmonized questionnaire that evaluates the impact of COVID-19 on firms’ operating status, sales, labor adjustments, and responses to the shock, among others. It was collected by the World Bank Group and several partner institutions in 51 countries  covering more than 100,000 businesses. For more details, see Apedo-Amah et al. (2020) and Cirera, Cruz, et al. (2021).

> 11 See Apedo-Amah et al. (2020).

> 12 The estimated number of cases and fatalities presented in this section are as of mid-October 2021.

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