Authors: Lorena Alcázar Valdivia, Debapriya Bhattacharya, Andrea Ordóñez, Tausi Kida, Dirk Willem te Velde
COVID-19 reached the poorest countries with a time lag but now they are facing multiple shocks. Commodity prices, especially oil prices, have fallen steeply, global demand for their products has gone down sharply, tourism receipts have reduced markedly and retail outlets and restaurants are closed, leading to massive global supply chain problems. In addition, the coronavirus has now reached most countries, resulting in lockdowns in developing countries, leading to a further slowdown (some estimate by 2–3% of annual GDP each month). While countries around the world, primarily developed ones, plan for stimulus packages to confront the crisis, many developing countries lack the fiscal space to implement such measures.
- Developing countries face the deepest recession in a generation. Complying with lockdown guidance in developing countries will be very challenging, given the level of informality and the state of poverty and health capacities.
- The G20 and UN need to address shortcomings to enable inclusive, collective and coherent global leadership.
- Urgent actions required to address the health and socio-economic costs include global actions plans on aid and finance, trade and food security, and free flows of knowledge and mobility of health workers.
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