Navigating the Post-Pandemic Economic Outlook

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It is not a prescient prediction that World Economic Order is faltering under the weight of pandemics and the magnitude of this economic meltdown is unprecedented. Though it’s impossible to reverse the damage or un-bankrupt the already ruined or closed businesses the most alarming reality is the lack of clear vision about future economic order. The economic roadmap to resuscitate the business and investments is still missing and policy-makers have yet to devise the blueprint for the post-pandemic economy. Ironically, many top economists of the world have wrongly anticipated that pandemic-induced recession could be liquidated by generous spending and Keynesian formula which will be followed by rapid V-shaped recovery. The era of magnificent delusions is long gone and governments are already feeling the weight of astronomical debts while their capacity to generate funds to repay debts has drastically shrunk. The economic landscape is bleak even in those countries which successfully circumvented the spread of the virus. The most-hyped V-shaped economic recovery is a phantasmagorical fantasy now. The International Monetary Fund predicts that by the end of 2021, the global economy will be barely larger than it was at the end of 2019 and that the US and European economies will still be about 4% smaller.
The post-pandemic uncertainty, bevy of bankruptcies, breakdown of supply chains, and disruption of organizational structures depict that the economic outlook of the world will have to undergo drastic structural adjustments. The sectors which survived the shock and projected to grow are skill-intensive and technologically advanced automated while labor-intensive businesses are waning. The production, consumption, and information flow patterns have changed and governments have to equip themselves with new models of economic governance to usher in sustainable economic recovery. The unfettered capitalist logic that markets will automatically absorb this economic shock is a dangerous misunderstanding and the role of governments in managing this sudden economic fallout is very important. The government intervention to circumvent the growing automation-induced inequality, digital divide, and medical inequality between haves and haves not is crucial to sustaining social and economic orders around the world.

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