COVID-19 as a Global Crisis in the New Socio-Economic Reality

Abstract

The COVID-19 pandemic has become a challenge for the global community and has led to a sharp downturn in the economies of many countries around the world. In January 2020, the IMF said that the world is heading towards a new Great Depression, as there is a trend similar to the situation of the 1920s. Hence, according to forecasts, the rate of economic growth in East Asia and the Pacific region by the end of 2020 will decrease to 0.5% and will reach the lowest level since 1967, being a reflection of the shocks associated with the pandemic. In China, extremely restrictive measures have led to an almost complete halt in business activity in some sectors and regions. China’s economic growth is expected to slow to 1% in 2020. Economic activity in the rest of East Asia and the Pacific region is projected to decline by 1.2% in 2020 and will recover to 5.4% in 2021. The economic consequences of the COVID-19 pandemic have had a detrimental impact on the countries of Europe and Central Asia, with the overall recession to 4.7% as forecasted for 2020. In the Middle East and North Africa, a 4.2% decline in economic activity is forecasted, because of the development of the pandemic and the collapsed oil market. In South Asia, as a result of measures to mitigate the effects of pandemics and collapse of global demand, have sharply fallen the volumes of industry, services and trade activities. The effects of the pandemic and the drastic fall in global commodity prices was a crushing blow for Latin American and Caribbean countries. A sharp slowdown in the economies of U.S. and China has disrupted supply chains to Mexico and Brazil and caused a stark drop in exports from Chile and Peru. The downturn in tourism has also had negative consequences. Such statistics confirm the opinion of many leading scholars in the world that the result of the COVID-19 pandemic will be a decrease in the level of hyperglobization of the world economy. In addition, a move away from U.S.-oriented globalization and a shift toward China-oriented globalization will also be likely.

The Crucial Factors and Prospects for the Recovery of the World Economy in the Global COVID-19 Recession

“…Беззаперечний руйнівний вплив світової пандемії на глобальну економіку зумовлює активізацію наукових розробок у напрямі формалізації специфічних ознак сучасної економічної кризи та оцінювання перспектив її подолання. Оцінюванню впливу COVID-19 на економіку та суспільство присвячені роботи як вітчизняних [6][7][8][9][10], так і закордонних [11; 12] науковців та аналітиків. У фокусі досліджень перебувають такі аспекти, як: визначення соціально-економічних втрат як на рівні національної економіки [8; 9], так і в глобальному вимірі [6; 7; 11]; галузева специфіка перебігу та подальшого розгортання світової економічної кризи [12]; моделювання сценаріїв відновлення економіки України в середньо-та довгостроковій перспективах [9; 10] тощо.…”