 |
| Mehdi Neimi |
The coronavirus pandemic has significantly slowed down economic activity worldwide. Speaking to Voice of America, economist Mehdi Neimi states that in order to classify the current economic stagnation as a full-fledged economic crisis, the situation must persist for an extended period.
According to Mehdi Neimi, “Even if the coronavirus had not emerged, experts believe that the world was already facing three hidden economic crises.”
He emphasizes that due to the pandemic, these hidden economic crises may surface more quickly.
“Even without the coronavirus, the world was heading toward these crises. Economists say that countries have been accumulating debt at a much faster rate compared to previous years... Another issue is the aging population. Particularly in developed countries, the population is getting older... The coronavirus has merely brought these problems to the forefront,” says the economic expert.
He believes that in developed countries with aging populations, large corporations will continue to manufacture their products in countries with younger populations. He also suggests that globalization will accelerate in this regard.
“Imagine a company relocates from its home country to manufacture goods in another country. The other side of this equation is how those products will be sold in the market. Perhaps this second aspect will undergo some changes... The slowdown in globalization actually started with Trump’s election. Trump managed to halt it in some areas, but in others, he could not,” Neimi notes.
The economist adds, “From now on, the transportation of goods may not be as smooth as before. Some changes might occur, and borders may slowly start closing. The key point here is that there will be changes in the distribution and sale of goods.”
In the interview, the economic expert also touches on concerns that the private sector may weaken due to the pandemic:
“In such situations, governments take on greater responsibilities. In some ways, governments may even welcome this as an opportunity to strengthen their authority. When general economic interests are at risk, the role of the state becomes more prominent. We see that with the coronavirus crisis, this role has significantly fallen on the shoulders of governments. This could lead to a strengthening of the public sector. However, the private sector is not as weak as it once was. Once this health crisis is brought under control, the private sector will resume its operations and begin to recover.”
Link to the original interview in Turkish on the Azerbaijani section of Voice of America:
Mehdi Nəimi: Koronavirus pandemiyası gizli iqtisadi böhranları aşkara çıxarır