It was the 1st of December 2019, with the outbreak of the pandemic; the first reported case of COVID-19, in the Chinese city of Wuhan. Strangely the doctor who identified the disease also passed away soon after reporting the disease. Enter 2020 and the cases related to COVID-19 expanded exponentially and crossing borders without any restrictions, and increasing number of deaths related to COVID-19 globally reported on a daily basis. This was followed by border closures for international travel, and lockdowns in cities. International trade almost came to a halt, along with many other businesses. Educational institutions, schools colleges and universities were shut down and local authorities placed orders for physical distancing. The world came to a halt. Airlines, businesses, trade and tourism corporations started to report huge fiscal deficits. This was the new normal.
The health crisis soon began to transcend into a full blown economic recession, with inflation and cost of living crisis proliferating and becoming ubiquitous. Although air travel resumed but the airline industry reported significant losses, amid the dwindling number of passengers and reduced routes. Some airlines even had to halt their operations in various regions. Big trading corporations, multinationals and other businesses were badly impacted and the pandemic led to the closure of many such ventures globally. This also led to changes in demographic patterns, with a reported increase in people migrating from one region to another region in search of better opportunities and better living.
The pandemic was not the only thing impacting the global economy; the opening of war theaters in Eurasia and Middle East further deteriorated any hopes of total economic recovery, with the rise in commodity and fuel prices.
The pandemic was not the only thing impacting the global economy; the opening of war theaters in Eurasia and Middle East further deteriorated any hopes of total economic recovery, with the rise in commodity and fuel prices. With the economy of major powers in the West running on the military industrial complex model, government allocations to spend on public welfare, education, health care, media houses and so on drastically dwindled, resulting in cost cutting measures. The US is a prime example, where the incumbent administration is adamant to shut down any department which is placing extra burden on the economy. Despite the apparent economic recession, funding for weaponry and arms is still going on to fuel wars in Eurasia and Middle East.
Meanwhile the global order also discerned some drastic changes in the past decade, with a significant decrease in the economic and political clout of the US, and China coming in the forefront with its multibillion dollar Belt and Road Initiative (BRI) proliferating in 150 countries. The Chinese development model gained more traction, diametrically opposed to the Western ‘boots on ground’ approach to solve economic and security issues. The BRI investments multiplied with 2024 being a record year; the investments increasing by 23% vis-à-vis 2023, and the net worth of the projects amounting to 121.8 billion USD with the signing of 340 deals. This trend marks the declining power of the Western democracies in terms of financing development ventures in developing countries.
The rapidly changing global scenario in the health, and economic domains, is coupled with the looming environmental crisis in the form of rising temperatures, melting of glaciers, and rising sea levels. The recent climatic events in various countries as fires in Los Angeles and flash flooding in various parts of US, Pakistan, Australia and New Zealand are a testament to this fact. Climate change is a global concern of prime importance, with potentially catastrophic consequences unless it is addressed on a war footing. The recent abrogation of the landmark Paris agreement signed in 2015, by the incumbent Trump administration raises an alarm regarding the implementation of this historic pact in letter and spirit. Notwithstanding the climate crisis, is the growing trend of populism and left wing politics based on the narrative of self-vs.-other and exclusion instead of inclusion. Consequently we see a growing trend in Islamophobia and policies based on discrimination and hate. The recent escalation in South Asia after the Pahalgam incident is also an important case in point, with two nuclear powers almost at the brink of war.
The global scenario seems gloomy; however, as every cloud has a silver lining, therefore there is still a beacon of hope regarding the future of the planet. It is high time for political leadership to discuss the issues of prime concern and work towards an amicable solution. Let’s hope that sanity will prevail.
The writer is affiliated with the Institute of Development Studies at Massey University, New Zealand.