The graph of global economy is expected to get the same as it was last year and is surely going to see a fall again. This is being reported by the global economists who have seen and have faced the consequences to the post pandemic situations. It’s like the patients who are recovering from the disease and similarly the economy in the year is taking a VV- shape. Even though the vaccine has arrived and around $26 trillion worth of crisis support have also fueled quite faster recovery than many anticipated and the legacies of stunted education with destruction of jobs, war-era levels of debts and widening inequalities between the races, genders, generations and geographies is surely going to leave lasting scars and most of them are the poorest of nations.
People might think that once the pandemic gets over everything will be on track. But that is not what the fact is; it’s going to be more and more difficult further. As being predicted by the Vellore arthi of the university of California, Irvine, who has examined the long term health and economic hit from the past situations and crisis of 2020. It’s like the effects being noted historically are often for decades and are not just easily addressed.
It’s said that the decline is on domestic products since last year was the biggest and bought greatest of depression in the economic situations. The international labor organization estimates its cost with the equivalent of 255 million people full time job. As of researchers at the pew research centre reckon, the global middle class ha shrank for the first time since the 1990’s.
Global economy and COVID -19
Since 2019, the global economy is getting harsher. It’s because of the pandemic situation which has caused major disruptions in the global economy which could have lasting adverse effects. The global economy is surely heading for a decade of growth disappointment. It’s because of the uncertainty about the post pandemic economic landscape and the policies that has discouraged investments, disruptions to education and has slowed down the human capital accumulation which concerns about the viability of global value chains. The course of pandemic has weighed on the trade and tourism.
When it’s about the fiscal positions and elevated debts, it’s the institutional reforms that would spur growth and will be quite important. It’s the comprehensive policy effort which is necessary to rekindle the robust, sustainable and equitable growth. It’s the package of reforms that would be intervened to increase the investment in human and physical capital to raise the female labor force participation which would help with reverse the expected impact of the pandemic on potential growth in the case of emerging markets and even with the developing economies over the next coming decades.
All told, the decline in gross domestic products last year was the biggest since the great depression. It’s the international labour organization would estimate it cost with the equivalent of 255 million people full time jobs. Researchers at the Pew research centre reckon the global middle class would shrank for the first time since the 1990’s.
The cost will fall unevenly and the scorecard of 31 metrics across 162 nations which is devised by the oxford economics Ltd highlighted the Philippines, Peru, Colombia and Spain as the economies most vulnerable to long term scarring. Australia, Japan, Norway, Germany and Switzerland were considered as the best place.
Experts like Arthi said that there needn’t be a lost decade if the right policy steps are being taken. Especially these are the areas of reskilling workers and putting a floor under those hit hardest by the crisis. One way includes encouraging policies that creates incentives for businesses to innovate and invest, particularly in climate change. It’s the central banks and many governments which are already signaling that they will maintain stimulus running hot. But the right kind of policy that mixes could push the rebound towards a complete recovery as of Catherine Mann, chief economist at the citigroup Inc.
It’s the innovation that supports higher productivity growth and new investment would surely raise the living standards. She even said that the key too are the strategies to keep and train workers to take advantage of the higher productivity opportunities.
Countries were quick to control the virus and are sending warning flares about the uneven road ahead. After the initial enjoyment of V-Shaped recovery, it’s the New Zealand’s economy being contracted in the final three months of 2020 as the absence of foreigners as tourists left a hole that the locals couldn’t fill. Now the country that had consistently topped the ranking of covid resiliency faces the prospect of double dip recession.
It’s in China where the pandemic has been under control for almost a year; the retail has been spending more and has lagged the broader recovery.
With experts like Tom Orlik, chief economists saying how the consumer confidence and spending patterns are shaped by ongoing concerns regarding the health and hiring could end up being one of the crisis most important economic legacies. Just as the great depression of the 1930’ led to greater thrift. That’s a risk which even though many people racked up with savings during the past time. Even there is genuine uncertainty over how much the people’s behavior in terms of consumption patterns changes as a result of crisis (said by Adam Posen, president of Peterson institute for international economics). People would surely taste genuine changes in which there is going to be transitionally more unemployment and there is even no better government to fix it.
Back to history
As of research history shows those five years after the country specific recessions, long term growth expectations are typically 1.5 percent points lower than in those without the recessions. This is being said by the World Bank. The crisis has accelerated the use of robots in both manufacturing and even in the services industry as workers and customers need to be protected from the spread of the pandemic.