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COVID-19 Pandemic Recession and Recovery

K. S. Jomo () and Anis Chowdhury ()
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K. S. Jomo: Khazanah Research Institute
Anis Chowdhury: Western Sydney University

Development, 2020, vol. 63, issue 2, 226-237

Abstract: Abstract This review draws pragmatic lessons for developing countries to address COVID-19-induced recessions and to sustain a developmental recovery. These recessions are unique, caused initially by supply disruptions, largely due to government-imposed ‘stay-in-shelter lockdowns’. These have interacted with falling incomes and demand, declining exports (and imports), collapsing commodity prices, shrinking travel and tourism, decreasing remittances and foreign exchange shortages. Highlighting implications for employment, wellbeing and development, it argues that governments need to design comprehensive relief measures and recovery policies to address short-term problems. These should prevent cash-flow predicaments from becoming full-blown solvency crises. Instead of returning to the status quo ante, developing countries’ capacities and capabilities need to be enhanced to address long-term sustainable development challenges. Multilateral financial institutions should intermediate with financial sources at low cost to supplement the International Monetary Fund’s Special Drawing Rights to lower borrowing costs for relief and recovery.

Keywords: Debt; Deficit; Food security; Industry policy; Recession; Recovery; Relief; Sustainable development; Stimulus packages (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1057/s41301-020-00262-0

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