Amidst unprecedented catastrophes of pandemic Covid-19, the global world from Asia to Europe, America to Africa garbling with the panacea of economic woes with looming threats of economic recessions. Based on the economic prowess, The vivid lines of first, second and third world states of past now blurred, with few exceptions, majority of the great economies of the world are undergoing through the grim consequences of one of the most non-traditional security challenge of pandemic Covid-19
In retrospect, the worldwide economy has faced various serious challenges in the 21st Century. Globalization has profited most of the world’s leading actors, yet the expanding interconnectedness of the global economy ensued grave apprehensions to the economic sector in various parts of the world. Some global issues are short term, for example, the ongoing downturn brought about by the credit crunch and related financial emergency. Majority of global economic shockwaves tend to be short term and might be self-correcting. Other short-run occasions can have enduring impacts, for example, the oil stuns of the 1970s, which for all time changed the worldwide oil market. Similarly, other global issues are long term and may require a strategic way to deal with discovering solutions. These issues incorporate worldwide imbalance and inconsistent economic turn of events, global poverty, the exhaustion of non-renewable assets, depletion of the climate and global warming, and foundational issues related to insufficient regulation of financial markets.
All challenges require urgent and unequivocal action, and each of the three can be converged together through concerted endeavours across the globe. It is significant, in any case, to comprehend the profundity and seriousness of the two long haul difficulties which are climate change and rising poverty, and their close connection, before we go to the more short term. Our reaction to environmental change and poverty decrease will define our generation. On the off chance that we fail on either of them, we will fizzle on the other. Unmanaged climate change will hopelessly harm possibilities for advancement in numerous parts of the world, and activity on the climatic change that frustrates development can never construct the global coalition on which such activities depend.
Additionally, in 2020, the most recent downgrade of the global economy came from a virus that and the entire world came under siege of a pandemic primarily known as the Coronavirus of COVID-19 which paused the entire world’s growth for a time being. The spread of COVID-19 across the globe has changed numerous individuals’ lives. As an ever-increasing number of individuals are approached to remain at home, numerous exercises have been compelled to move from offline to online (O2O), including work, shopping for food, deliveries, education, and diversion. As the wellbeing and human cost developed, the economic damage is now apparent and represents the biggest financial shock that the world has encountered in many years. The spread of the pandemic made every country impose lockdowns which lasted for months. The lockdowns resulted in degrading the market economy since the persisting virus outbreaks caused restrictions over movements including trade, import, and export.
There are five pattern shifts all around the world that by their nature of worldwide collaboration, yet have been thought little of, underestimated, and under-addressed both broadly and universally whose outcomes have shaken our reality with an unforeseeable power.
Nevertheless, the Multilateral institutions and International organizations have somewhat proven to be the most effective way through which, both, the developing and emerging countries can find suctions to solve the complex global economic problems peacefully and constructively.
For a better future, the countries should strategize on enabling firms to make industry decisions and technology choices based on the economy’s comparative advantage which will later allow the states to perform better than the alternative approach which is the comparative advantage defying strategy. The comparative advantage following (CAF) strategy will be more effective in allowing the countries to catch up and reduce the growing poverty along with inequality within their nations.
To grow, the developing countries shall shift to sustainable development. First, it requires a stronger focus on flow variables, (for example, the debt servicing cost-to-export income proportion) as opposed to stock factors, (for example, the obligation to-GDP proportion) in evaluating the obligation circumstance of a nation. Second, policymakers should make considerable investments in the developed organizations that intend to encourage reasonable and better incorporation of their nations into regional and worldwide value chains. This could improve domestic worth-added and access to technologies and assets, and also enhance economic activities, consequently assisting with expanding effects of SDG investments and limiting related risks. Third, there should be a reexamining of the role of private areas in the society, which should go past private financing and include support for the way toward diminishing any risks encompassing SDG financing and investment. To conclude with, the global world must work collectively to mitigate the growing economic challenges.