At this writing, eighteen months have passed since the Covid-19 outbreak was declared a pandemic by WHO. It has tested the responsiveness of governments and the resilience of economic systems everywhere; it has changed social behaviour and personal habits in ways previously unthinkable. The dedication of essential workers has shone through dark times, while the scientific community has harnessed the power of collaborative research and public money to develop a vaccine at breakneck speed.
At the same time, the pandemic has exposed just how unprepared countries, including the wealthiest, are for unexpected shocks, a point underscored by a series of extreme weather events this year, and just how deeply divided the global economy has become. Four decades of eroding government services, heightened inequalities, unchecked financialization and impunity for financial and corporate elites have taken their toll.
On the economic front, the dramatic collapse of output, as countries locked down to contain the spread of the virus, was so dramatic as to trigger unprecedented responses. Massive Central Bank action in rich countries stabilized financial markets and unparalleled (at least in recent times) government spending cushioned firms and households against the worst of the downturn. A global recovery began in the second half of 2020, as countries adopted less draconian ways to manage the health risks, and is still unfolding, even as regional and country prospects vary widely amid disparities in fiscal space, new virus variants and uneven vaccination rates.