COMMENT | There has been a lot of debate on the impact of the new movement control order (MCO) implemented for two weeks from Jan 13 and the state of emergency from Jan 11 to Aug 1. Much of the debate reflects anger and frustration at the two events and confusion over whether the MCO will be shorter or longer than announced. While this is understandable, it is often not constructive.

It is much more worthwhile to consider what might or should happen to the economy taking the MCO and the emergency as given and also taking the highly probable position that the MCO will extend beyond two weeks based on current daily case numbers for Covid-19 and past experience both here and around the world.

As a working hypothesis, it is reasonable to assume that the economy will respond this time, much as it did last time but from a much weaker base with much-depleted reserves to weather the coming challenges.

As a baseline scenario, we must expect that for the next six months the economy will be at best stagnant with...