THE ROLE OF THE G20 IN STRENGTHENING ECONOMIC RECOVERY AFTER THE COVID-19 PANDEMIC
Janine Grant Issue Brief No. 2/2021 September 2021 By: Fakri Karim
COVID-19 has had a serious impact on every layer of our society, affecting peoples' livelihood, economies, international trade, and global cooperation. It has also exacerbated our existing systematic problems, ranging from climate change to inequality, which continuously weaken our effort and ability to improve prosperity. However, COVID-19 has been an eye-opening phenomenon that had demonstrated how local problems have significant potential to trigger global challenges. Moreover, it has shown that collaboration is a fundamental aspect to survival during crises and that we must seize the opportunity to build back better, learning from global shared experience, and promote efficient and effective cooperation in the future.
Globally, COVID-19 experiences show that many countries have taken various emergency measures to strengthen their healthcare, social protection, and overall governance systems to deal with the crisis. Yet, the innovative, best practices and vaccine production largely came from developed countries, highlighting the reality that the development gap, as well as poverty alleviation, is a chronic issue that needs to be addressed accordingly and collaboratively. The G20 - as an international forum that brings together the world’s major economies whose members account for more than 80% of world GDP, 75% of global trade, and 60% of the population - has the biggest potential to boost the COVID-19 impact management, especially the poverty alleviation agenda. Building an economic model that is adaptive to pandemics, improving the healthcare system and access to social protection, promoting sustainable and greener city development, robust governance and stronger partnerships are four critical development narratives that are intertwined and needed to be emphasize in the G20 discussions.
1. Adaptive Economic Model
Countries across the global have taken economic recovery measures to reduce the impact pandemic impact, amounting to 10% of GDP, but the results have been insignificant compared to the resources provided for recovery. The strategic planning and utilization of these resources must not only facilitate recovery but also help build back better, ensuring that post-COVID-19 economic growth and employment expansion are oriented toward sustainable development, and economies that are more resilient to global shocks. This includes rethinking our approaches and shifting mental models to consider more adaptive economic models and approaches by focusing on sustainable financial assistance or relevant incentives and policies that target low-income communities or labor-intensive sectors – those most at risk during global crises.
Moreover, exploring technology and digital solutions is critical as economic behavior has shifted throughout the year. Connectivity and integration became crucial to link low-income and marginalized communities to a variety of job opportunities, especially creative sectors that have proven to essential survival for low-income households during the pandemic. Improving the skill sets of people through better and adaptive education curricula, including online, will also have a strong correlation with how the global economy will thrive during a crisis.
Improving the local economic infrastructure will also improve the resilience of countries during global economic recessions. As an example, when the global food supply system was disrupted because of the pandemic, local food production and supply helped to maintain food security and sustain the local economy.
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