Five years after OMS (World Health Organization), and also undergoing the impact of the following wars, the global economy still undergoes the effects of the sanitary crisis, presenting high interest rates, low growth and structural changes in supply chains.
The evaluation is Roberto DumasProfessor of International Economy at Insper, who points out that one of the causes of the scenario is the relocation of the world’s supply chairs, which began in the pandemic. This is an inflationary change that should not be reversed anytime soon, warns.
So much so that the latest projections in the World Bank show that the expectation is from a worldwide expansion of 2.7% per year between 2025 and 2026, a rise still insufficient to compensate for the impacts of the shock series suffered by global activity, such as pandemic and invasion of Ukraine by Russia and war in the Middle East.
If the expectation is confirmed, global growth will be 0.4 below-average percentage point between 2010 and 2019 in the pre-pound, and the institution points out that worldwide interest rates should reach an average of 4% by 2025 and 2026, double the average of two decades prior to.
“The expansionist fiscal policy that followed the pandemic in the world can be wiped, but the renegotiation of globalization is here to stay,” says Dumas, in an interview with Infomoney. “Interest is high in the world and are beginning to be reduced in the United States, in Europe, but I don’t see it returning to what it was in the 2000s.”
Check out the full interview of the teacher, who holds a master’s degree in Economics from the University of Birmingham in England and a master of Chinese economy from the University of Fudan (China).
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What was Covid 19’s main impact on the global economy?
One of the main changes was the readjustment of supply chains around the world. Instead of depending only on a country, on offshooring [prática de transferir processos produtivos de uma empresa para outro país]companies started to make onshooring, that is, to produce indoors, or produce in nearby countries, the so -called Nearshooring – an example is Mexico, who benefited a lot by turning into an alternative to China. By doing so, you do not buy cheaper suppliers, you diversify, end up desecrating the comparative advantages of the economy. And things get more expensive.
What other changes have boosted inflation in the world?
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Companies also did not trust the policy of “Just in Time”, that is, the zero stock, when the company departs from the premise that, when finishing its stock, already has a ship coming to supply. It has increased the chance of having a pandemic, a war to disrupt the just in time, and the CEOs of companies think: I need to have a high stock to ensure. But the high inventory is also a cost for the company, requires more working capital. It is a higher cost that also goes to prices.
All this happened to the Covid-19 pandemic and then worsened with the following wars, such as the invasion of Ukraine through Russia and then the Middle East conflict.
Can you expect a worldwide turn to the previous economic rules, pre-pound? Did tax incentives, for example, have come to stay?
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The expansionist fiscal policy that followed the pandemic in the world can be wiped, but the renegotiation of globalization is here to stay.
Interest is high in the world and starting to be reduced in the United States, in Europe, but I don’t see it returning to what it was in the 2000s, with rates of 0.25%, 0.5% per year. This no longer happens, at least in the medium term, no.
What is your perspective for the world economy in the coming years, with Donald Trump’s second term?
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Given that our premise is that interest and inflation tend to become higher, I see smaller world economic growth and greater disorder of productive chains. I find it hard to believe that we will grow with Donald Trump, with all this unlocket that is happening in the productive chains and this economic uncertainty that the United States government is placing in major partners and also in allies.
