The economic impact of Covid-19 continues to stretch the word economy by unimaginable margins. Apart from the impact of shutdowns, the health sector across all countries has consumed a huge part of annual spending.
However, the bigger surprise has been how various countries have managed to bounce back and stabilize sooner than expected. This unexpected rapid recovery is expected to increase even more in 2021, and here are some of the contributing factors.
Rather than looking at the immediate impact of investments, countries need to look at how they can become leaders in the future by providing an enabling environment to their citizens. They need to find a way of investing in technologies such as electric transportation, hydrogen, and AI.
It is also critical for developed countries to invest in under-capitalized first-world countries that are expected to be the focal markets in the future.
According to Anthony Teixeira, a top-rated French translator for businesses, long-term government policies are a great inspiration for the private sector. Through the rapid investment by the private sector, hundreds of both short-term and long-term job opportunities are achieved.
For example, after the economic recession in 2008, many countries rolled out wind-solar and grid projects. The same can be done to revive the global economy in 2021. Government stimulus should be used to support energy-efficient projects to build a stable economy in the future.
Empower the consumer
An empowered consumer in 2021 will see rapid economic global economic growth. Even with the best stimulus packages from the government, if the consumer is not empowered, they are less likely to take advantage of these programs. Governments should ensure there are transparency, proper infrastructure, and the availability of essential household goods.
Incentives can also play a major role in shaping consumer behavior. For example, the government can increase incentives for clean vehicles to reduce air pollution. Another silver lining that can see a rapid resurgence of the world economy is the policy response by various countries.
Modernize existing infrastructure
If the infrastructure is allowed to deteriorate, reviving the economy will remain just but a dream. While several countries are doing a fantastic job in this, others are not doing an excellent job as they still lack modern technology and other crucial physical infrastructure.
Without adequate infrastructure, a moving economy will fail to maintain efficient and flexible operations to enable it to compete with other moving economies in the world. The guiding principle for any country looking to move its infrastructure to a new level should be to improve the already existing ones.
However, the renewed facilities should be at the very least meet the modern standards, which are energy efficient and minimize the long-term operation cost.
Simplify government bureaucracy
One of the major obstacles to reviving the global economy is the complex and burdensome regulation by governments. That way, other economies are moving faster than others.
For instance, rooftop solar installation in the US is twice as expensive as in Germany and takes three times longer due to the cumbersome installation laws in the US. Such regulations are standard, especially in third world countries, and there is a need for such countries to simplify their regulations and their permit processes in 2021.
Create fair policies for clean energy
Most countries across the world have subsidies or tax arrangements in place to benefit the fuel industry at the expense of clean energy. A good example is Germany, where retail electricity consumers pay up to 30 euros per kWh during oil and gas retail for only 7 cents. The introduction of carbon fees by most governments is an excellent motivation to invest in clean infrastructure.
Fossil fuel industries like Shale oil drillers in Texas and various coal miners in China face significant economic distress and will have no choice but to restructure in 2021.
To prevent such industries from falling to the ground, governments need to provide financial incentives to fund their clean energy transition. Alternatively, the shuttered fossil fuel plants can be converted to other uses that are more suitable to the public.