This briefing is the outcome of consultations with leading chief economists from both the public and private sectors and leaders from the Stewardship Board of the World Economic Forum’s Platform for Shaping the Future of the New Economy and Society. It aims to summarise the emerging contours of the current economic environment, assess perceived policy effectiveness and identify priorities for further action by policy-makers and business leaders in response to the global economic crisis triggered by the Covid-19 pandemic.
Whilst there are relatively positive views of the overall speed and magnitude of policy actions, and targeted measures for health, households and firms are considered to be most effective in principle, there is concern about their execution. There is a perceived risk that insufficient policy coordination nationally and globally could hinder the effectiveness of the efforts underway. Additionally, we should consider the short-term impact on the most vulnerable as well as the medium- to longer-term impact on inequality and sustainability.
It concludes that public health must remain at the core of the policy response, keeping people safe and supporting rapid progress on treatment options and a vaccine over the coming months. In addition, four issues were found to deserve particular attention as policy-makers think about next steps to achieve a robust recovery: identifying effective channels for rapid disbursements to firms; supporting vulnerable workers and households with precision; overcoming borrowing constraints for low- and middle-income countries affected by the crisis; and balancing emergency responses with expanding policy priorities beyond GDP growth.