Song, Ligang, and Yixiao Zhou. “The COVID‐19 Pandemic and Its Impact on the Global Economy: What Does It Take to Turn Crisis into Opportunity?” China & World Economy, vol. 28, no. 4, July 2020, pp. 1–25, doi:10.1111/cwe.12349
The academic journal “China and the world Economy” reports a study on the impact Covid-19 had on the global economy. It also provides policy measures that could be used to recover from this recession. The study begins by explaining that several global economic uncertainties were already existent before the spread of the corona virus, and as a result the virus contributed to further damage the global economy. The study is broken up into different sections.
The first section explains the impact of Covid-19 on the global economy. This section also introduces four economic uncertainties that existed before Covid-19 and explains how not confronting these issues can further impact the economy. The first pre-existing economic uncertainty that is mentioned is” Secular Stagnation” meaning a prolonged period of lower economic growth. They explain that the longer the pandemic lasts the more severe Secular Stagnation will impact the global economy. The second pre-existing economic uncertainty is the issue of income and wealth inequalities in different countries. They explain that in the past three decades the income inequalities between countries have decreased. But with the spread of covid-19 poor developing countries have experienced a heavy economic downturn and had to urgently turn for help from richer nations. By accepting this help, the debt of these poor countries increased and unintentionally caused a setback in the global economy by reversing the decline in countries’ inequalities. The third conflict the study brings up is the slowdown in global trade and global investment the study explains that this issue was already existent before the Global Financial Crisis of 2008. Unfortunately, the outbreak of Covid-19 further impacted this financial sector. It explains, that in an uncertain economy firms are less willing to invest internationally and rather do business domestically. This behavior leads to deglobalization and to a further downfall of the global economy. The final conflict is the increasing global debt and the inability to produce growth. They explain that the total amount of debts in different countries have exponentially increased and have produced very little growth since the Global Financial Crisis of 2008. The economic shut down from Covic-19 forced numerous countries to take out additional loans of millions and trillions of dollars to support their economies, prevent job losses and bankruptcies. These additional loans add more burden to countries who were already facing a weak economy.
The second section of the study discusses measured that can be implemented to emerge from this crisis and gives 3 key points that can help boost the economy. The first point advises that structural economic reforms that are created to boost the economy are fundamentally important and should be implemented. Secondly, the study argues that research and development (R&D) for new technologies is essential for increasing economic productivity. The third point that was made is that global economic helpfulness and unification are necessarily important for fighting this virous and reviving the global economy. The final section is the conclusion and it summarizes the study that was conducted and reinforces the 3 key points that can help recover the global economy.
Overall, I believe this was a great study because it gave me a lot of insight on how countries have endured in this difficult financial crisis. A section of the study I agree with is the part of “Secular Stagnation”. Which includes this statement “During the pandemic, uncertainty has risen and consumer and business confidence has dropped significantly. Businesses and individuals have become more risk-averse and have tighten their belts to save more money during and after the pandemic.” (Song & Zhou, p.7) As I discussed in the introduction people are afraid and this fear is deeply hurting the economy. Another section of the study I agree with is when it explains that research and development (R&D) is fundamental for increasing the economic productivity of countries. “Innovation and technological breakthrough have the potential to significantly boost productivity through creative destruction and resource reallocation towards more efficient industries and firms. The subsequent productivity growth would be the key to sustain long-term global growth and raise living standards for humankind. (Song & Zhou, p.19) I support the idea of Research and Development and believe is a great way to boost the economy. The writers of the study use factual information to get their point across and also use comparing techniques. An example of the comparing technique used is this “It makes the Great Lockdown the worst recession since the Great Depression, and far worse than the GFC, in which global growth fell by –0.1 percent year on year.” (Song & Zhou, p. 2-3). The source of my information is credible because it was written by two professors in the Economics department in the Australian National University.
This is great. Very thorough and you clearly have all the elements required for the annotation, but when you revise, can you please try to keep each section separate. In other words, just as you have the summary here in its own paragraph, have the evaluation, separate from the rhetorical analysis and these separate from the quotations.