Countries like the US, the UK and Germany should prepare for a long slow recovery with prolonged periods of instability in the wake on Covid-19 pandemic, a new research has warned.
The team from University of Surrey's Centre for Understanding Sustainable Prosperity (CUSP) found that even before the Covid-19 crisis, many of the world's leading economies were experiencing larger slower growth cycles (recession cycles), suggesting precisely such a period of critical slowing down in the economic system.
The team's analysis suggested that the added weight of the Covid-19 crisis may result in one of the weakest and most unstable recoveries in recorded history for many economies.
The global economy is facing one of the largest downturns since the Great Depression in the 1930s.
"Placing the economy on hold to prevent unfathomable human tragedy from the Covid-19 pandemic was the right decision. Trying to force our way back to economic growth now would be the wrong one. A post-growth world is the new normal," said Professor Tim Jackson, Director of CUSP at the University of Surrey in a paper published by Nature.
Rates of growth across member states of Organisation for Economic Co-operation and Development (OECD) have been in decline since the 1970s, a phenomenon known as 'secular stagnation'.
The average growth in gross domestic product (GDP) per capita fell from over 4 per cent in the mid-1960s to little more than 1 per cent in the pre-pandemic years.
The International Monetary Fund expects global GDP to decline by 5 percent this year alone with a contraction of 3 percent likely even in the emerging and developing market economies.
"It's time to rethink and remake the economic models that have been failing us for decades. The challenge is enormous. But so is the prize. CSD theory suggests that a resilient, sustainable economic system which protects the health of people and planet is now within our grasp," Jackson noted.
The overall number of global COVID-19 cases crossed the 10 million mark on Sunday, with deaths nearing 500,000, according to the Johns Hopkins University.
The US accounted for the world's highest number of infections and fatalities with 2,510,323 and 125,539, respectively, according to the CSSE.
Brazil came in the second place with 1,313,667 infections and 57,070 deaths.
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