grynspan2_ Lev RadinPacific PressLightRocket via Getty Image_antonio guterres Lev RadinPacific PressLightRocket via Getty Images

A Second Chance for Global Development

The COVID-19 crisis has generated global political momentum to alter the balance of power between the state and the market in macroeconomic management. Hopes of building back better now hinge on the emergence of a new policy paradigm to help guide a just transition to a decarbonized world.

GENEVA – Second chances are not common in this world, but one is arriving now. The scope and scale of government support for businesses and workers during the COVID-19 crisis of the last 18 months have swept aside entrenched policy dogmas. This has generated political momentum across advanced and developing economies to change the balance of power between the state and the market, and thereby foster a new consensus for achieving more equitable and sustainable growth. By building on this impetus, we can avoid repeating the policy mistakes of recent decades.

The COVID-19 pandemic has tested governments’ responsiveness and the resilience of economic systems everywhere, and changed social behavior and personal habits in previously unthinkable ways. There has also been cause for genuine hope amid the suffering. The dedication of essential workers has been inspiring, while the global scientific community has harnessed the power of collaborative research and public money to develop safe, effective COVID-19 vaccines at breakneck speed.

A global economic recovery began in the second half of 2020, as countries found less draconian ways to manage the pandemic’s health risks and launched vaccination programs. Global growth is expected to reach 5.3% this year, the highest rate in almost a half-century. But the outlook beyond 2021 is uncertain, given disparities in countries’ financial resources, the prospect of new coronavirus variants, and highly uneven vaccination rates.

We hope you're enjoying Project Syndicate.

To continue reading and receive unfettered access to all content, subscribe now.



Unlock additional commentaries for FREE by registering.