For the world to be prepared for future global crisis like the Covid-19 pandemic, countries need to invest in people as much as in their economies, the International Monetary Fund managing director has said during a live event sponsored by Qatar Foundation (QF).
Kristalina Georgieva outlined her views at The Outlook for Global Business, which discussed the global economic landscape during the Covid-19 pandemic and how it can recover from the crisis moving forward.
“Protecting lives and protecting the economy and livelihood go hand in hand,” said Georgieva during the talk, hosted by the Harvard Business Review and supported by QF.
“For the world to be agile and resilient in the next crisis, it is so critical that people are healthy, have access to healthcare, are able to function in an agile manner, and can learn remotely.”
“Return to growth [post-pandemic] will be on the basis of massive digital infusion for businesses, and underlying that is investing in people.”
According to Georgieva, the solutions proposed around the world to fight the pandemic, whether medically or economically, cannot be implemented without people executing these solutions. She said that even after a vaccine for Covid-19 becomes available, for instance, many countries do not have the adequate medical staff or facilities to inject the vaccine among people, and so healthcare systems need to be strengthened prior to the vaccine being ready – and that can only be achieved by empowering people.
She also emphasised that another important factor in recovering from the crisis economically is to prepare for a digital future.
“One thing this crisis is telling us is that the digital transformation is accelerating. So, you do need to think about equality through access to digital. Anything that is digitally enabled wins,” she said, adding that trade agreements and government policies need to account for the expanding scale of e-commerce to become more agile.
Georgieva stressed the need to continue global trade and international cooperation to mend the economic damage caused by the coronavirus, especially to underprivileged communities.
“It is very straightforward and simple: when we trade with each other, we are all better off. When we don't, costs go up, incomes go down, and poverty spreads,” said Georgieva.
“If you're poor, global trade shrinks the price of what you pay by one-third to three-quarters. In other words, you benefit tremendously. So, we need to make sure we don't lose the benefit of trade that has served the world for thousands of years.”
She also highlighted the importance of capitalising on environmentally sustainable economic growth to prevent similar crises in future, something she said she is already optimistic about post-Covid-19.
“We would see more attention to sustainable agriculture and to everything that is connected to more sustainable lifestyles,” she said. “And hopefully — with the right policies in place — green growth and investing in low-carbon, climate-resilient development will be a winner.”
Georgieva told the event’s audience that all of these mitigation practices need to be implemented right away and not after the crisis is over.
“Forget about the hope that we will get rid of the pandemic and then start the recovery,” she said. “We have to move with recovery while the pandemic is still with us.”