A Decade After the 2009 Global Recession: Macroeconomic Developments

Wee Chian Koh and Shu Yu

Journal of International Commerce, Economics and Policy (JICEP), 2021, vol. 12, issue 02, 1-24

Abstract: Emerging market and developing economies (EMDEs) weathered the 2009 global recession relatively well. However, the impact of the global recession varied across economies. EMDEs with stronger pre-crisis fundamentals — such as large foreign exchange reserves, sound fiscal positions, and low inflation — suffered milder growth slowdowns, in part due to their greater capacity to engage in monetary and fiscal stimulus. Low-income countries were also resilient, as foreign aid and inflows of remittances remained relatively stable. In contrast, EMDEs that were heavily dependent on short-term capital flows — such as portfolio investment and cross-border bank lending — fared less well, especially those in Europe and Central Asia. A key lesson for EMDEs is the need to strengthen macroeconomic frameworks and create policy space to prepare for future global downturns.

Keywords: Global recession; global financial crisis; emerging market and developing economies; commodity price collapse (search for similar items in EconPapers)
Date: 2021
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Working Paper: A Decade after the 2009 Global Recession: Macroeconomic Developments (2020)
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DOI: 10.1142/S1793993321500113

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