BY AHMAD ABUBAKAR DUBAGARI[1]
1.0 Introduction
The relationship between Law and Economy is like that of a tree
and roots. Economy is just like a tree with luxurious leaves and
colourful flowers: what nourishes and sustains the leaves and the
flowers is the roots (Laws and Policies). When the colors of the
flowers wither, it is the roots will facilitate growth of another.
In other words, Global Emergencies have the potentials of plunging
world economy into recession, with the consequences of unemployment
and deprivation. For Instance, economist warned that the recent
outbreak of Covid-19, could cost the global economy an estimated
$1.1 trillion in lost income.
Consequently, the negative effects of emergencies on the global
economy show an undeniable need for appraising the role of law in
reforming economies. For centuries, law has provided societies with
necessary tools for the realization of economic policies. Law has
provided mechanisms for intervention and point of direction in the
economic process of countries. Against this background, the kernel
of this write up is to analyse the negative effect of Global
emergencies on the economy with a view to highlight the roles of
Law and Policies in cushioning such negativity. But from the onset,
it’s germane to embark on a journey to figure out what Global
emergencies is all about.
2.0 The Concept of Global Emergency
The word emergency in this context is referred
to a crisis that has the potential to grow beyond the coping
capacity of the affected community, single organization or group of
a community at risk.[i] To declare an emergency is to
set aside a normal state of affairs or to acknowledge that such a
departure has already occurred[ii]. Emergency may be
on two levels, State and Global. Hanrieder and
Kreuder-Sonnen[iii][1]
Contend that state of emergency is the legal order through which
sovereign states respond to security crises. States of emergency
constitute an exceptional type of government and follow a distinct
logic. In this situation, given the unanticipated,
exceptional nature of existential threats, law has to recede in
order to facilitate decisions aimed at re-establishing political
order. On Global Emergency, Handrier and Kreuder-Sonnen, remarked
that
Security threats are increasingly seen as worldwide
contingencies that do not respect national boundaries, particularly
within the discourse of globalization. Environmental disasters,
terrorist attacks, financial breakdowns or globalized pandemics are
some of the prototypical crisis scenarios in which high-speed
decision-making and rapid political interventions are seen to be
needed.[iv]
Some issues seems to have surfaced From the above statement.
Firstly, there are three kinds of emergencies which include
Political, Economic and Natural Emergencies. Political emergencies
are kind of emergencies that involve security threats such as War,
Terrorists Attacks like September 11. Economic Emergencies are all
emergencies that begin in financial crisis, like the Argentine
fiscal crisis of 2001. Finally, natural emergencies, as the name
implies, are event that caused by natural events such as Tsunami,
like Hurricane Katrina or diseases like the ongoing Coronavirus
(Covid-19). Secondly emergencies have the potentials of setting
aside normal state of affairs and constitute an exceptional kind of
government. The reason for this suspension is that, during
emergencies, the principal concern of governments is to preserve a
nation whose survival is somehow imperiled. However, setting aside
the normal state of affairs wretch a deep havoc on economy.
3.0 Negative Effects Global Emergency on
Economy
The negative effects of emergencies on economy could be seen as
it creates high level of unemployment, disruption in the process of
production and all kind of economic activities. An American Judge
Olsen, although trying to equate economic emergency with natural,
has vividly painted the negative effects of emergencies on economy
in the authority of Home Building and Loan Association v.
Blasdell[v]
Where he insisted that
The present nationwide and worldwide business and financial
crisis has the same results as if it were caused by flood,
earthquake, or disturbance in nature. It has deprived millions of
persons in this nation of their employment and means of earning a
living for themselves and their families; it has destroyed the
value of and the income from all property on which thousands of
people depended for a living; it actually has resulted in the loss
of their homes by a number of our people and threatens to result in
the loss of their homes by many other people in this state.
The above postulation explain that people do loss their Jobs,
properties and means of earning a living as a result of
emergencies. Governments also loss their incomes. For instance, as
a result of the recent breakout of the Global Emergency, Covid-19,
IMF warned that economies in Asia would see no growth this year,
for the first time in 60 years. Furthermore, US April unemployment
rate has risen to a record 14.7%, with more than 20 million jobs
lost and EU GDP is forecast to contract by 7.5% during 2020.[vi]Thus the germane question here is, what is the
role of Law and Policies in reviving such economy?
4.0 The Role of Law in Cushioning Negative Effects of
Global Emergency on Economy
Stability in economy is critical for the survival of any
society. The role of law in this aspect is to seek all means to
avert regression and decent into chaos through Disputes resolution,
Rules, guidelines and measures and relevant Legal Frameworks that
establish order and good atmosphere in the economy.
4.1 Law as a Mechanism for Dispute
Resolution
In order to contain any emergency, countries around the globe do
adopt stringent measures such as curfews or lockdowns, with have
negative implications on businesses, more especially small scales,
and contractual relations. So this may result in high litigations
as a result violation of agreements among others. Laws and Policies
in regard utilizes canons in exploring the nature of contentions
stemming from this, and resolve it in order to improve good
economic atmosphere and development.
4.2 Law and Policies as a tool for Reviving Businesses
and Contracts
Although the right to economic freedom is a fundamental
individual right, during emergencies, the government may infringe
upon such rights. A policy may be issued to restrain institution
from sacking workers as a result of lack of performance caused by
emergency. Furthermore, law and policies may be enacted/issued to
impose a mandatory loan scheme on financial institutions to fund
small scale businesses on a low or subsidized interest rate. Law
may also suspend some contractual clauses. For instance, as a
result of Emergency, the court in Hamdi v. Rumsfeld[vii][2], upheld the
section of the Minnesota Mortgage Moratorium Law extending the
period during which a mortgagor could redeem her property after
foreclosure as against a Contract Clause.[viii][3]
4.3 Law as an Instrument for Economic
Reforms
Government may adopt legislations to achieve its goal of
economic development. Law creates a room to facilitate
structural reforms of the unhealthy financial industry and adopt
best practices that may serve a long way in cushioning the negative
effects and fill the vacuum exposed by emergency on the
economy.
4.4 Law and Policies as instruments for Ensuring Healthy
Economic Environment
The appropriate role of criminal law in the process of
mitigating economic hardship caused by emergency, especially Public
Health Emergency, is imposition of penalties. Infectious Diseases
and Public health laws often contain penalties for failing to
comply with public health orders made by authorities, or for
engaging in behaviours that place public health at risk. This
encourage the public and the market players to participate in the
market for its being healthy and safe. Policies and laws may make
it mandatory for the economic players to disclose their health
status in order to avoid an unintended consequence for exposing
another person to infectious such as Covid-19.
5.0 Conclusion
Legal sector has wide-ranging economic impacts, which can help
long way in mitigating the negative effect of Emergencies on
economy. Law plays a fundamental and important role in creating
good atmosphere for economic activities. Laws and Policies
are the key facilitator of economic development through the
promotion of more sophisticated economic activity. Without these
two instruments, the economic development is uneasy to be
conducted, since the support and stability is hard to get.
[1] AHMAD ABUBAKAR DUBAGARI is a
Pen Name for AHMAD ABUBAKAR, He writes from
Faculty Law, Ahmadu Bello University, Zaria. He could be reached
through his email ahmedbuba19@gmail.com[4]
or phone number +234 8 14 6515 644
[i] United Nations, Living with risk: A global
review of disaster reduction initiatives. (vol. 1, Geneva,
ISDR, 2004.).
[ii] Bernadette Meyler. ‘Economic Emergency and the
Rule of Law.’ Cornell Law School research paper No. 06-045
<http://ssrn.com/abstract=944618[5]>
[iii][6]
Tine Hanrieder and Christian Kreuder-Sonnen, WHO decides on the
exception Securitization and emergency governance in global health
[2014] Vol. 45, No. 4, Security Dialogue, pp. 331-348 <https://www.jstor.org/stable/10.2307/26291745[7]>
[iv]ibid, 336
[v] [1933] 189 Minn. 422, 437
[vi]Hurt, Rosamond (2020) The economic effects of
COVID-19 around the world. (2020) <https://www.weforum.org/agenda/2020/02/coronavirus-economic-effects-global-economy-trade-travel/[8]> accessed
on 26th May, 2020.
BY AHMAD ABUBAKAR DUBAGARI[1]
1.0 Introduction
The relationship between Law and Economy is like that of a tree
and roots. Economy is just like a tree with luxurious leaves and
colourful flowers: what nourishes and sustains the leaves and the
flowers is the roots (Laws and Policies). When the colors of the
flowers wither, it is the roots will facilitate growth of another.
In other words, Global Emergencies have the potentials of plunging
world economy into recession, with the consequences of unemployment
and deprivation. For Instance, economist warned that the recent
outbreak of Covid-19, could cost the global economy an estimated
$1.1 trillion in lost income.
Consequently, the negative effects of emergencies on the global
economy show an undeniable need for appraising the role of law in
reforming economies. For centuries, law has provided societies with
necessary tools for the realization of economic policies. Law has
provided mechanisms for intervention and point of direction in the
economic process of countries. Against this background, the kernel
of this write up is to analyse the negative effect of Global
emergencies on the economy with a view to highlight the roles of
Law and Policies in cushioning such negativity. But from the onset,
it’s germane to embark on a journey to figure out what Global
emergencies is all about.
2.0 The Concept of Global Emergency
The word emergency in this context is referred
to a crisis that has the potential to grow beyond the coping
capacity of the affected community, single organization or group of
a community at risk.[i] To declare an emergency is to
set aside a normal state of affairs or to acknowledge that such a
departure has already occurred[ii]. Emergency may be
on two levels, State and Global. Hanrieder and
Kreuder-Sonnen[iii][1]
Contend that state of emergency is the legal order through which
sovereign states respond to security crises. States of emergency
constitute an exceptional type of government and follow a distinct
logic. In this situation, given the unanticipated,
exceptional nature of existential threats, law has to recede in
order to facilitate decisions aimed at re-establishing political
order. On Global Emergency, Handrier and Kreuder-Sonnen, remarked
that
Security threats are increasingly seen as worldwide
contingencies that do not respect national boundaries, particularly
within the discourse of globalization. Environmental disasters,
terrorist attacks, financial breakdowns or globalized pandemics are
some of the prototypical crisis scenarios in which high-speed
decision-making and rapid political interventions are seen to be
needed.[iv]
Some issues seems to have surfaced From the above statement.
Firstly, there are three kinds of emergencies which include
Political, Economic and Natural Emergencies. Political emergencies
are kind of emergencies that involve security threats such as War,
Terrorists Attacks like September 11. Economic Emergencies are all
emergencies that begin in financial crisis, like the Argentine
fiscal crisis of 2001. Finally, natural emergencies, as the name
implies, are event that caused by natural events such as Tsunami,
like Hurricane Katrina or diseases like the ongoing Coronavirus
(Covid-19). Secondly emergencies have the potentials of setting
aside normal state of affairs and constitute an exceptional kind of
government. The reason for this suspension is that, during
emergencies, the principal concern of governments is to preserve a
nation whose survival is somehow imperiled. However, setting aside
the normal state of affairs wretch a deep havoc on economy.
3.0 Negative Effects Global Emergency on
Economy
The negative effects of emergencies on economy could be seen as
it creates high level of unemployment, disruption in the process of
production and all kind of economic activities. An American Judge
Olsen, although trying to equate economic emergency with natural,
has vividly painted the negative effects of emergencies on economy
in the authority of Home Building and Loan Association v.
Blasdell[v] Where
he insisted that
The present nationwide and worldwide business and financial
crisis has the same results as if it were caused by flood,
earthquake, or disturbance in nature. It has deprived millions of
persons in this nation of their employment and means of earning a
living for themselves and their families; it has destroyed the
value of and the income from all property on which thousands of
people depended for a living; it actually has resulted in the loss
of their homes by a number of our people and threatens to result in
the loss of their homes by many other people in this state.
The above postulation explain that people do loss their Jobs,
properties and means of earning a living as a result of
emergencies. Governments also loss their incomes. For instance, as
a result of the recent breakout of the Global Emergency, Covid-19,
IMF warned that economies in Asia would see no growth this year,
for the first time in 60 years. Furthermore, US April unemployment
rate has risen to a record 14.7%, with more than 20 million jobs
lost and EU GDP is forecast to contract by 7.5% during 2020.[vi]Thus the germane question here is, what is the
role of Law and Policies in reviving such economy?
4.0 The Role of Law in Cushioning Negative Effects of
Global Emergency on Economy
Stability in economy is critical for the survival of any
society. The role of law in this aspect is to seek all means to
avert regression and decent into chaos through Disputes resolution,
Rules, guidelines and measures and relevant Legal Frameworks that
establish order and good atmosphere in the economy.
4.1 Law as a Mechanism for Dispute
Resolution
In order to contain any emergency, countries around the globe do
adopt stringent measures such as curfews or lockdowns, with have
negative implications on businesses, more especially small scales,
and contractual relations. So this may result in high litigations
as a result violation of agreements among others. Laws and Policies
in regard utilizes canons in exploring the nature of contentions
stemming from this, and resolve it in order to improve good
economic atmosphere and development.
4.2 Law and Policies as a tool for Reviving Businesses
and Contracts
Although the right to economic freedom is a fundamental
individual right, during emergencies, the government may infringe
upon such rights. A policy may be issued to restrain institution
from sacking workers as a result of lack of performance caused by
emergency. Furthermore, law and policies may be enacted/issued to
impose a mandatory loan scheme on financial institutions to fund
small scale businesses on a low or subsidized interest rate. Law
may also suspend some contractual clauses. For instance, as a
result of Emergency, the court in Hamdi v. Rumsfeld[vii][2], upheld the
section of the Minnesota Mortgage Moratorium Law extending the
period during which a mortgagor could redeem her property after
foreclosure as against a Contract Clause.[viii][3]
4.3 Law as an Instrument for Economic
Reforms
Government may adopt legislations to achieve its goal of
economic development. Law creates a room to facilitate
structural reforms of the unhealthy financial industry and adopt
best practices that may serve a long way in cushioning the negative
effects and fill the vacuum exposed by emergency on the
economy.
4.4 Law and Policies as instruments for Ensuring Healthy
Economic Environment
The appropriate role of criminal law in the process of
mitigating economic hardship caused by emergency, especially Public
Health Emergency, is imposition of penalties. Infectious Diseases
and Public health laws often contain penalties for failing to
comply with public health orders made by authorities, or for
engaging in behaviours that place public health at risk. This
encourage the public and the market players to participate in the
market for its being healthy and safe. Policies and laws may make
it mandatory for the economic players to disclose their health
status in order to avoid an unintended consequence for exposing
another person to infectious such as Covid-19.
5.0 Conclusion
Legal sector has wide-ranging economic impacts, which can help
long way in mitigating the negative effect of Emergencies on
economy. Law plays a fundamental and important role in creating
good atmosphere for economic activities. Laws and Policies
are the key facilitator of economic development through the
promotion of more sophisticated economic activity. Without these
two instruments, the economic development is uneasy to be
conducted, since the support and stability is hard to get.
[1] AHMAD ABUBAKAR DUBAGARI is
a Pen Name for AHMAD ABUBAKAR, He writes from
Faculty Law, Ahmadu Bello University, Zaria. He could be reached
through his email ahmedbuba19@gmail.com[4]
or phone number +234 8 14 6515 644
[i] United Nations, Living with risk: A
global review of disaster reduction initiatives. (vol. 1,
Geneva, ISDR, 2004.).
[ii] Bernadette Meyler. ‘Economic Emergency and
the Rule of Law.’ Cornell Law School research paper No. 06-045
<http://ssrn.com/abstract=944618[5]>
[iii][6]
Tine Hanrieder and Christian Kreuder-Sonnen, WHO decides on the
exception Securitization and emergency governance in global health
[2014] Vol. 45, No. 4, Security Dialogue, pp. 331-348 <https://www.jstor.org/stable/10.2307/26291745[7]>
[iv]ibid, 336
[v] [1933] 189 Minn. 422, 437
[vi]Hurt, Rosamond (2020) The economic effects
of COVID-19 around the world. (2020) <https://www.weforum.org/agenda/2020/02/coronavirus-economic-effects-global-economy-trade-travel/[8]> accessed
on 26th May, 2020.