(Economic Observation) After the epidemic, can the world economy return to the past?

  China News Agency, Beijing, September 13 (Reporter Zhao Jianhua) The epidemic has changed the world. Economic recession and financial market fluctuations have forced some countries to choose to drink poison to quench their thirst.

Traditional monetary and fiscal policies have been impacted, and years of globalization have been frustrated.

  After the outbreak, research institutions frequently adjusted economic forecasts, including S&P.

The agency predicted in April that the world economy will shrink by 2.4% in 2020, and the United States and the Eurozone will fall by 5.2% and 7.3%, respectively.

  Only three months later, S&P adjusted its forecast: global GDP will shrink by 3.8% in 2020, which is worse than expected in April, and emerging markets, led by India, will suffer a deeper and longer-term blow.

Financial stimulus must be used to promote economic growth, and countries around the world have no choice.

  Shaun Roache, chief economist of S&P Global Asia Pacific, believes that the global job market will not be strong in the next few years.

The weak job market will continue until 2021 or even longer.

Employment opportunities in the retail, catering, and accommodation industries have been deeply affected by the epidemic, resulting in high unemployment rates.

Residents will be very cautious in their consumption, more people choose to save, and some consumption-driven industries will be affected.

  In the face of the epidemic, economies dominated by service industries are even more vulnerable.

Andrew Michael Spence, winner of the Nobel Prize in Economics, said that because of the epidemic, countries such as Italy, which account for a relatively high tourism income, will have a worse economy in the next few years.

The already existing unfair distribution has been "made worse" because of the epidemic.

  Under the impact of the epidemic, the old and new ideas clash violently.

Liu Yuanchun, vice president of Renmin University of China, said that although the epidemic is not a disruptive factor that completely changes the pattern, it is a catalyst to accelerate the pattern change.

After the 2008 international financial crisis, pessimists believe that it may take five to six years for the world economy to recover.

But until now, the world economic growth rate has not returned to before the financial crisis.

For the world economy from 2008 to 2019, the economics community regards it as "long-term stagnation": low growth, low trade, low growth, low interest rates, high debt, and high leverage.

This may still be the case in the future.

  Under the impact of the epidemic, central banks of various countries released water and started money printing machines again, and major economies around the world launched massive fiscal and financial stimulus.

Ma Jun, a member of the Monetary Policy Committee of the People's Bank of China and director of the Finance and Development Research Center of Tsinghua University, said that according to expert estimates, there may be more than 10 trillion US dollars in fiscal stimulus around the world.

If a considerable part of the 10 trillion US dollars is used for investment, plus supporting financial resources, this is a very large sum of money.

  During the epidemic, the fiscal and monetary policies of some countries were integrated and supported.

The government's fiscal relief, but fiscal revenue has fallen due to the epidemic, and it is weak.

Central banks of various countries have come forward to support finances and purchase government debt, that is, national debt.

  This may be "drinking poison to quench thirst."

Cao Yuanzheng, chairman of China International Research Co., Ltd., said that it is expected that the global economy will further decline in the third quarter than in the second quarter. Countries are forced to release water. “They all die. The poison must also be drunk."

  Central banks of various countries started printing money printing presses and purchased national debt. Traditional fiscal and monetary policies were impacted, and disagreements followed.

Liu Yuanchun said that in the face of the epidemic, it is right for countries to adopt unusual monetary and fiscal policies.

But the road ahead is still very long. It hasn't been exhausted yet, and extreme practices such as "helicopter throwing money" are not advisable.

  Under the impact of the epidemic, globalization has been frustrated and international coordination has become more difficult.

International capital flows have become headless flies, shocking back and forth.

  The costs of globalization have been overemphasized, and the advantages and benefits of international cooperation have been overestimated.

Andrew Michael Spence said that if you lose multilateralism and engage in bilateral relations, it is easy for large countries to protect their own interests. Small countries, especially poor countries, will suffer first.

Multilateralism is like setting up a big tent. Whether large or small countries, rich or poor countries, they can find a place under the tent, instead of throwing small or poor countries out of the tent and letting them fend for themselves.

  Under the impact of the epidemic, without the big tent of globalization, how can those low-income countries shelter from the wind and rain?

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