Lockdowns and shutdowns imposed to deal with the Covid-19 pandemic have taken a huge toll on every major economy. Donald Low, Professor of Practice in Public Policy at the HKUST and IEMS Faculty Associate discusses three hard truths about the Covid-19 crisis that policymakers around the world must get prepared for in order to minimize the risks of sending the global economy into a depression. The first is that every major economy is currently in some form of lockdown, with significant parts of their economies effectively shut down. Meanwhile, the global economy is likely to go into recession in 2020 even if the disease is more or less contained by the middle of the year. The second hard truth is that it is extremely unlikely that suppression will succeed in eliminating the disease. Cases are likely to rise again when the lockdowns are lifted or when the autumn flu season arrives. The third hard truth is that the current system of neoliberal globalisation, which was threatened but neither abandoned nor significantly reformed during the global financial crisis, is no longer “fit for purpose”. Policymakers must not miss the opportunity this crisis offers to rethink and remake the current system of globalisation, and make it more resilient against shocks that are currently all too easily transmitted in our overly networked world.
Read his column article published on 3 April on South China Morning Post.