The world has been transformed by the COVID-19 crisis. Beyond its tragic human costs and loss of life, the pandemic and the necessary lockdowns have resulted in severe economic impacts with immense job losses and a major threat of global depression. Impacts will differ across countries, with emerging markets and developing countries also hit by historic declines in commodity prices, tourism and remittances, and unprecedented reversals in capital flows, which have fuelled a deep loss of confidence and exacerbated vulnerability to other potential shocks. The outlook is uncertain. We are in unchartered territory and a fast bounce-back cannot be guaranteed. It could take several years to recover from this crisis, with long-lasting effects. The world was on an unsustainable and vulnerable path before the crisis and the recovery must avoid the dangers and fragilities of the past, not only with respect to climate but more broadly with respect to the environment and planetary boundaries, and with increasingly inequitable growth and a lack of social cohesion. There can be no going back to the old normal. Attempts to unwind existing environmental regulations and policies and return the economy to the old model, which was characterized by low productivity, high inequality and climate/ environmental risk, would be misguided and could severely hinder the ability of countries to respond to the multiple challenges and forces of change they are facing. In this context, finance ministers will need to reflect on comprehensive and ambitious recovery/stimulus packages that can help resuscitate economies, restore employment and also build a better future – one that is more inclusive, sustainable and resilient. A common challenge for all finance ministers will be around jobs, both in dealing with the immediate impacts of job losses, but also managing the structural challenges ahead that will see a rapid shift in skills and the way we work.
