With the Corona pandemic nearing an end, concern for the global economic consequences of it has increased after months of delving into the controversy of saving the economy or lives.

Writer Juan Corona said - in a report published by the Spanish newspaper, Atalayar - that the economic crisis that the whole world suffers from - largely caused by the mismanagement of the epidemic by most governments - has different characteristics from the classic crises resulting from the recession.

The global economic stagnation - according to the report - is not due to known macroeconomic issues, but rather to political decisions that affected most productive sectors.

Speed ​​up vaccination campaigns

The writer explained that the rate of global economic contraction, caused by the pandemic, exceeds what was left by the 2008 crisis, at a time when the International Monetary Fund expected global GDP to decrease by about 3 points for each month of closure.

Therefore, it is necessary - the writer says - to accelerate vaccination campaigns to return to normal life as soon as possible.

The writer pointed out that future economic policies must be designed to face the repercussions of the epidemic.

Compared to previous crises, some conditions are favorable to revive the economy, especially since productive capacity has not diminished, but rather has remained stable at a specific level.

Although this would allow achieving significant growth rates in the short term;

However, we must not forget the absence of productive units in the various sectors, the writer adds.

In the opinion of the author, this problem can be solved if appropriate measures are taken to strengthen sectors;

Such as new technologies, online sales, etc.

Consumption habits have also undergone changes in the short term, but they cannot be said about their consistency in the medium term.

The writer emphasized that it is imperative for politicians to commit to implementing economic policy measures that effectively compensate for the weaknesses in the new production and consumption model.

Anxiety About Keynesian Politics

The writer said, "Various governments are working to implement the so-called (Keynesian policies), which is worrisome for two reasons; the first is the partial and erroneous interpretation of the Keynesian theory, and the second is the inappropriate adaptation of these policies to the current crisis."

With regard to the first point, the author explained that what the global economy is witnessing is not a demand crisis, and government spending has not stopped rising in recent months.

But for decades, countries with current revenues will not be able to keep up with spending;

This will lead to excessive increases in public indebtedness.

Second, the Keynesian theory oriented towards increasing growth is based on an increase in government spending in exchange for a tax cut, so that the effect of the fiscal multiplier does not diminish.

It is an approach difficult for politicians to understand, the writer believes.

The author cautioned that the combination of expansionary fiscal policy and fiscal stimulus by central banks may have positive results in the short and medium term.

But it may cause an increase in inflation in the long run, a rise in interest rates, and a reduction in liquidity.

These measures may coincide with a rise in public debt, which means that future prospects for the global economy will not be promising.

The writer says that humanity is making unremitting efforts that have proven effective in combating the Covid-19 pandemic. But will it be able in the near term to find solutions to the economic crisis in light of the public debt already doubling global GDP?