This is the first report in ODI’s Economic Pulse series. It explores China’s international economic response to Covid-19 and analyses its international engagements, especially in developing countries, in light of shifts in the global economic and political landscape. Our review of China’s economic response has an international focus due to the nature of the macroeconomic data, while project-level data and a policy review drill down into the effects of that response on developing countries.
On Thursday 29 of October at 16:00 pm (CET) we hosted a webinar event in cooperation with OECD on multilateral development finance in response to the COVID-19 crisis. The webinar investigated the dynamics of the Multilateral Development Finance framework in the wake of COVID-19, and made concrete recommendations on the most effective and impactful ways forward.
COVID-19 has led governments across the Middle East and North Africa (MENA) to take a number of measures to battle the pandemic. Many of these actions directly related to religious practices such as the cancelation of the Hajj pilgrimage to Mecca, closing down mosques and amending the call to prayer from the usual “hayya alas-salah” or “come to prayer” to “salu fi buyutikum” or “pray in your homes”.
Populism has revealed one of its weaknesses, by displaying particularly ineffective crisis management. However, it is not clear that populism will be politically unsuccessful in the post-corona future. The ability of populists to mobilise supporters, to concentrate powers and to spread a narrative of the crisis aligned with their nationalist and authoritarian ideology should not be underestimated. They could show resilience by relying on a broader anti-globalist narrative, conspiracy theories and polarization.
While the 2008/2009 global economic crisis had many negative consequences, one positive effect was that it massively accelerated international cooperation on tax matters. This is the kind of impetus that we also need for tackling the Covid-19 pandemic. The focus is not on generating more revenues, but rather primarily on achieving greater equity in the way that revenues are generated. This requires more public discussion of fair taxation. After all, the way that resources are mobilised and deployed to tackle the crisis will also have an impact on state legitimacy and social cohesion.
The EU is putting forward the idea of a COVID-19 marker on aid data to track the unprecedented mobilisation of resources to tackle the crisis globally. Rather than such a marker, the EU should consider supporting more sustainable and technologically-savvy approaches to ensure much needed transparency and accountability. The EU could back a number of other initiatives that are likely to better meet information needs, strengthening data ecosystems in developing countries and improving global reporting during and beyond the ongoing crisis.
There is not a ‘one-size-fits-all’ solution to respond and recover from the current global health emergency and economic fallout resulting from COVID-19. A combination of pragmatic solutions is needed to face the debt issue and give countries room to make the policy choices and investments that will also lay foundations to recover, putting people and nature at the heart of economic growth and development.
Media coverage of the Covid-19 pandemic has raised the profile of armed groups in curious and often contradictory ways. ODI’s Centre for the Study of Armed Groups will seek to address these challenges in several ways.
The years preceding the health crisis linked to the Covid-19 pandemic, marked in particular by the oil counter-shock of 2014 and the signing of the Paris Climate Agreement of 2015, saw the emergence of (weak) signals of diversification of the activity and investment of certain oil companies—essentially the European majors—towards low-carbon energies. While these announcements could have a knock-on effect on the sector, they are still very insufficient in view of the effort required to initiate a rapid and profound transition of the sector towards decarbonisation,2 and are contested by several civil society actors.
The Covid-19 virus has caused a convulsive shock to the global economy. There remains considerable uncertainty around the pathway of the pandemic, the means and speed of any economic recovery and what structural changes – particularly to the globalisation of trade and capital – it will bring in the longer-term.