We start the week with an in-depth discussion with a global economist.
Governments around the world are rushing to protect their economies from a crushing recession
as the coronavirus outbreak continues to spiral across the world, paralysing all sectors and
wiping out millions of jobs. We're seeing hundreds of billions of euros
and two trillion dollar-plans being injected, interest rates slashed and subsidies rolled
out to cushion the blow. But is this enough? And what about countries that can't afford
huge stimuls plans? Today we're joined by Dr. Kaushik Basu, Professor
of Economics at Cornell University, who served as the Chief Economist of the World Bank from
2012 to 2016. We're seeing many countries taking measures
like rate cuts and massive stimulus plans, but in a situation where the world's largest
economies are going into lockdown, financial markets are still volatile. Why are the usual
textbook approaches failing to provide reassurance and what are they lacking?
Many are hoping for a V-shaped recovery to the economy. Maybe the numbers will add up
eventually. But what are the chances that jobs won't recover as quickly?
We're seeing national borders close, some finger pointing between world leaders and
a general lack of cross-border coordination when it comes to handling COVID-19. Even in
the EU, President of the European Central Bank Christine Lagarde announced a huge bond-buying
programme to stimulate the regional economy which gave rise to concern that old feuds
from the 2008 financial crash may resurface. What are the risks of politics hindering global
cooperation amid this pandemic? Take developing countries like Botswana where
government revenue relies heavily on the global demand for commodity exports and tourism,
or labour-intensive economies like Bangladesh how vulnerable are their economies?
The World Bank committed $14 bil. to helping developing countries combat COVID-19. But
is this enough? What should be done on
a global scale to limit impact on
developing
economies and their
people's livelihoods? That's
all we have time for today but thank you Dr. Kaushik Basu, for
joining
us
from Mumbai.