This optimism is also based on the deployment of vaccines to control the coronavirus pandemic. This means that returning to normal business during 2021 is less ambitious than it used to be.
But the result is too slow to save millions of jobs and hundreds of billions of dollars in newly created public debt around the world.
What began as a cloudy year with the mild threat of the fierce US presidential election, continued trade tensions with China, and tight deadlines for Britain’s relations with the European Union saves economic growth in an unprecedented blockade. It became an existential test for.
This is a chart selection that ultimately saw the havoc and ruin caused by Covid-19 during the extraordinary 12 months for the world.
According to the OECD’s combined leading indicators, the pace of recovery in the world’s developed economies is below pre-crisis levels. This tends to precede the economic turning point by about six months.
Do it slowly
Around the world, economic policy makers have moved into emergency mode. Central banks either lowered interest rates to new lows to ease financial conditions or kept them at ultra-loose levels below zero.
Authorities also announced a new emergency program, over-quantitative easing, and just as government bonds began issuing more debt to fund the financial response to the crisis. I procured a lot of government bonds.
Unprecedented government spending to mitigate the effects of the blockade has boosted public borrowing around the world. In some countries, debt levels are now at their highest levels in decades.
Due to all efforts, the government has been unable to protect all jobs and the unemployment rate has risen since the beginning of the year. Some sectors, such as tourism and airlines, are facing long-term changes, many jobs can be lost forever, increasing the potential for long-term economic scars.
The misery of immigrants
Still, remittances proved to be more resilient than expected. Cash transfers from US immigrants to Latin American families are expected to be about the same as the 2019 total, well above the World Bank’s forecast for April.
Commerce is dealing
Despite concerns that the collapse of international trade flows in April was more serious than at any time after the war, the decline in 2020 was about the same as that seen during the global financial crisis. According to the OECD, this in part reflects a sharp drop in consumer demand for less trade-intensive services.
Joe Biden’s election victory in November could also help trade if he returns to the “America First” policy that the United States has pursued over the past four years. It may help avoid a complete reversal of globalization, the results calculated by Bloomberg Economics will reduce global gross domestic product by $ 31 trillion by 2050.
Progress has been made in at least one aspect of all the setbacks in 2020. Women broke new ground by wielding economic reins, and both the United States and Canada elected women’s finance ministers for the first time. Janet Yellen will assume the role of Treasury Secretary in 2021.
© 2020 Bloomberg
A final glimpse of the nightmare year of the world economy
https://www.moneyweb.co.za/news/economy/take-a-last-glimpse-at-a-nightmare-year-for-the-world-economy/ A final glimpse of the nightmare year of the world economy