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To Reallocate Sdrs to Where They Are Most Needed Will Be an Improvement BUILDING BACK BETTER IN A POST-COVID-19 WORLD POST-COVID-19 A BETTER IN BACK BUILDING REIMAGINING THE GLOBAL ECONOMY: REIMAGINING GLOBAL THE 1 Editors Brahima S. Coulibaly Kemal Derviş Homi Kharas Zia Qureshi Managing Editor David Batcheck Authors Alaka M. Basu Homi Kharas Kaushik Basu Ayhan Kose Amar Bhattacharya John W. McArthur Max Bouchet Anthony Pipa Brahima S. Coulibaly Eswar Prasad Alistair Dieppe Zia Qureshi Kemal Derviş Jose Maria U. Tapia David Dollar Emiliana Vegas Marcela Escobari Rebecca Winthrop Carol Graham Eduardo Levy Yeyati Design Blossom.it Reimagining the global economy: Building back better in a post-COVID-19 world About the Global Economy and Development program Founded in 2006, the Global Economy and Development program at Brookings aims to shape the policy debate on how to improve global economic cooperation and fight global poverty and sources of social stress. With a long-term vision of strong, sustainable, and balanced growth for a prosperous world, the program undertakes high-quality research, identifies target audiences and policy opportunities, and shares its findings to inform new policy solutions. To learn more visit www.brookings.edu/global Follow on Twitter at www.twitter.com/BrookingsGlobal Acknowledgements The Brookings Institution is a nonprofit organization devoted to independent research and policy solutions. Its mission is to conduct high-quality, independent research and, based on that research, to provide innovative, practical recommendations for policymakers and the public. The conclusions and recommendations of any Brookings publication are solely those of its author(s), and do not reflect the views of the Institution, its management, or its other scholars. Brookings recognizes that the value it provides is in its absolute commitment to quality, independence and impact. Activities supported by its donors reflect this commitment and the analysis and recommendations are not determined or influenced by any donation. A full list of contributors to the Brookings Institution can be found in the Annual Report at www.brookings.edu/about-us/annual-report/ 4 Table of contents Preface 6 Sustainable Development Goals: 8 1 How can they be a handrail for recovery? Leadership at the local level: 16 2 How can cities drive a sustainable recovery? Multilateralism: 24 3 What policy options to strengthen international cooperation? WORLD POST-COVID-19 A BETTER IN BACK BUILDING 4 Rebooting the climate agenda: 32 What should the priorities be? 38 5 The international monetary and financial system: How to fit it for purpose? The future of global supply chains: 46 6 What are the implications for international trade? ECONOMY: REIMAGINING GLOBAL THE The global productivity slump: 52 7 What policies to rekindle? Dislocation of labor markets: 60 8 What policies to mitigate the shock? Tackling the inequality pandemic: 9 70 Is there a cure? 10 The human costs of the pandemic: 78 Is it time to prioritize well-being? 11 The complexity of managing COVID-19: 86 How important is good governance? 96 12 Global education: How to transform school systems? 5 Preface The COVID-19 global pandemic has produced handrail for recovery policy. Recent examples a human and economic crisis unlike any from governments and the private sector in recent memory. The global economy is show a momentum towards incorporating the experiencing its deepest recession since world’s economic, social, and environmental World War II, disrupting economic activity, targets into recovery. The pandemic has travel, supply chains, and more. Governments revealed the importance of good leadership at have responded with lockdown measures the local level. In Essay 2, the authors explore and stimulus plans, but the extent of these the role that global cities can have in driving actions has been unequal across countries. a sustainable recovery. Within countries, the most vulnerable Given the global nature of the pandemic, populations have been disproportionately there have been calls for greater international affected, both in regard to job loss and the cooperation. The author in Essay 3 spread of the virus. examines the state of multilateralism and The implications of the crisis going forward presents lessons of caution as its future is are vast. Notwithstanding the recent reimagined. Central to global cooperation announcement of vaccines, much is unknown is the shared recognition of the climate about how the pandemic will spread in the agenda. In Essay 4, the author explores how short term and beyond, as well as what will international action can pursue a recovery be its lasting effects. What is clear, however, that produces sustainable, inclusive, and is that the time is ripe for change and policy resilient growth. The pandemic has also reform. The hope is that decisionmakers exposed the weaknesses in the international can rise to the challenge in the medium financial systems and the need to improve term to tackle the COVID-19 virus and the financial safety net for emerging and related challenges that the pandemic has developing countries. In Essay 5, the authors exacerbated—be it the climate crisis, rising make the case for an international monetary inequality, job insecurity, or international and financial system that is fit for purpose to cooperation. help countries better withstand shocks like a global pandemic. In this collection of 12 essays, leading scholars affiliated with the Global Economy The pandemic’s impact on the global and Development program at Brookings economy and the future of trade has been present new ideas that are forward-looking, significant. International trade has slowed, policy-focused, and that will guide policies and existing trade challenges, including and shape debates in a post-COVID-19 world. automation, new data flows, and the rise of protectionism, could accelerate post-COVID. Some have questioned whether the pandemic In Essay 6, the author discusses these has put attaining the already ambitious 17 challenges, the future of global supply chains, Sustainable Development Goals (SDGs) out and the implications for international trade. of reach, and whether they should be scaled Another trend that the pandemic could further back and deprioritized. In Essay 1, authors accelerate is the fall in global productivity, argue that the SDGs remain as relevant as which has been slowing since the global ever and that the goals can in fact provide a 6 financial crisis. Evidence from other from school, governments around the recent pandemics such as SARS and world have enacted varying measures Ebola show their negative impact on to respond to the virus. In Essay 11, the investment growth and productivity. In authors examine how governments in Essay 7, the authors argue that policy emerging markets have managed the approaches to boost productivity must crisis so far, as they design governance be country-specific and well-targeted. strategies that both reduce the spread of infection and avoid prohibiting Throughout the world, the health and economic activity. COVID-19 disrupted economic costs of the pandemic education systems everywhere and have been felt harder by less well- has accelerated education inequality as off populations. On the jobs front, seen through what service governments WORLD POST-COVID-19 A BETTER IN BACK BUILDING the pandemic is affecting labor could provide: At one point during the markets differently across and within pandemic, one in four low-income advanced and developing countries countries was able to provide remote as low-wage, high-contact jobs are education, while nine in 10 high-income disproportionally affected. In Essay countries were able to. In Essay 12, the 8, the authors explore the future of authors present an aspirational vision work and policies for formalizing and for transforming education systems to broadening labor protections to bolster better serve all children. resiliency. Essay 9 presents evidence While the uncertainty around the as to why inequality is rising, including ECONOMY: REIMAGINING GLOBAL THE technology, globalization, and weakening pandemic and its effect loom large and redistribution policies in many countries. create a challenging policy environment, To tackle inequality, the author discusses together, the ideas in these essays offer policies to better harness technology for a way forward for decisionmakers to fostering inclusive economic growth. Yet reimagine the global economy and build another component disproportionately back better from COVID-19. affecting the poor is human well-being and mental health, with evidence suggesting higher emotional costs for the poor during the pandemic. In Essay 10, the author offers a look into well- being measurement and strategies to Brahima S. Coulibaly Vice President and Director combat the effects of the lockdowns. Global Economy and Development Ultimately, the pandemic has shown that economic growth alone is not enough to sustain societies. From strict lockdowns to ensuring sufficient supplies of personal protective equipment to sending students home 7 8 Sustainable 1Development Goals: How can they be a handrail for recovery? Homi Kharas Senior Fellow, Center for Sustainable Development, Brookings Institution BUILDING BACK BETTER IN A POST-COVID-19 WORLD POST-COVID-19 A BETTER IN BACK BUILDING John W. McArthur Senior Fellow and Director, Center for Sustainable Development, Brookings Institution The issue COVID-19 has triggered an onslaught of bad news for global sustainable development. The deepest global ECONOMY: REIMAGINING GLOBAL
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