2021: THE GREAT RESET

2021: The Year Of The Great Reset

Mint’s annual year-end issue, in collaboration with Project Syndicate, looks at what’s in store in 2021. Current and former political leaders, senior policymakers, and renowned scholars provide original, exclusive and incisive analyses of the tasks that lie ahead to ensure that we are not caught sleeping again

A global recovery’s leading variables

• While the world’s advanced economies have been able to run huge fiscal deficits to prevent significant losses to GDP, govts in developing nations, EMs cannot provide anywhere close to the same level of support
• The covid-19 recession has put many developing countries and emerging markets in a precarious financial position

The Red Dragon’s strategic overreach

• In the past 6 years, Modi had met with Xi 18 times, in the hope of fostering friendlier relations (and weakening the China-Pakistan axis).This hope appeared to have blinded India to China’s preparations for aggression
• A US-India strategic alliance has long been China’s security nightmare. Yet, by repaying Modi’s peace overtures with stealthy land grabs, Xi has made such an alliance more likely

2021 should be year of the ‘Great Reset’

• The pandemic has reminded us that we cannot aim solely for higher GDP and profits, on the assumption that maximizing these indicators automatically redounds to the benefit of society.
• A renewed focus on public health, net-zero pledges and the arrival of Stakeholder Capitalism Metrics will ensure that 2021 will be a new 'Year Zero’.

The path to recovery in coming decade is fragile

• The reduction in capital expenditures will reduce potential output for good, and workers who experience long bouts of joblessness or underemployment will be less employable in the future
• As the race to control the industries intensifies, there will be increased deployment of AI/ML and other labour-replacing, skill-biased technologies

Is post-pandemic labour revival possible?

• The pandemic has highlighted the vital role played by essential workers in sectors such as health care and logistics, especially those in precarious, low-paid jobs
• In contrast to the recession after the 2008 global financial crisis, the covid-19 downturn has elicited strong public support for workers, which may translate into measures that benefit labour

The quiet financial crisis that is brewing

• A quieter crisis seems to be gaining momentum in the financial sector. Even without a Lehman moment, it could jeopardize prospects for economic recovery for many years to come.
• The high leverage of countless firms on the eve of the pandemic will amplify the financial sector’s balance-sheet problems in the coming year.

Lessons from Rwanda’s fight against Covid

• Rwanda’s health system follows a decentralized model that emphasizes prevention and care at the community level, thus ensuring geographic equity and access.
• Rwanda’s success in fighting covid-19 should lead us to rethink many assumptions about what it takes to build a strong health system

2020 was a watershed year for European Union

• In 2021, global cooperation ought to make a strong comeback, and the EU should continue to pursue “strategic autonomy” so that it can safeguard its citizens and interests in the years ahead.
• Revitalizing multilateralism in the development and distribution of covid-19 vaccines and in areas of climate change will be a top priority for the EU in 2021.

There will be no quick coronavirus fix

• Covid has brought out the very best in science and medicine. But there is still only a slim chance that we will have a treatment that is effective enough to stop the pandemic before the end of 2021.
• However, experience shows that public-health measures that are stringently applied through strong leadership, governance, and social solidarity can quickly bring a pandemic under control.

Has Covid-19 killed Asia’s growth miracle?

• Although Covid has exposed the vulnerabilities of global supply chains, pursuing a strategy of localizing production would be devastating for the global economy.
• Instead, overcoming supply-chain weaknesses requires enhancing globalization and economic integration, and diversifying sources of supply to build resilience.

Overcoming Trumpism by reaching out

• While Joe Biden squeaked through to victory, there are millions of people who feel—and voted—the same way: Trump is 'one of us', a father and a saviour
• The answer, for Democrats, is not to pander to prejudices of the least educated citizens. But it will be essential for a progressive party to link itself once more to the underprivileged

How might the virus change the world?

• The world faces several global problems, such as climate change, resource depletion and inequality. But it hasn’t united against them the way it is being galvanized by covid-19.
• As people join hands to defeat the pandemic, they may become motivated to come together to combat other issues too. Covid-19 will then have brought not only tragedy but also salvation.

Recovering global leadership is crucial

• While G20 leaders came together in the aftermath of the 2008 financial crisis to save the world economy, there is now a lack of global leadership.
• In its absence, each country is left to focus on what it can do domestically to avoid a protracted pandemic. But even as they focus on domestic challenges, global cooperation will be key to inclusive recovery.

Learning to live with the pandemic

• While treatments for moderate and severe cases have significantly improved, they remain unsatisfactory. And testing is flawed, expensive, and subject to supply-chain weaknesses.
• While individual countries must adapt solutions to local conditions, the covid-19 response must ultimately be global

West-Islamic clash needs a mindset shift

• The difficult political and social transitions in much of the Islamic world mean that many Muslims feel the need to rely even more on the certainties of their faith
• What is badly needed is a wide-ranging dialogue between the West and Islamic civilizations that puts all issues on the table, with the hope of gaining a sympathetic understanding of the other’s perspective

Argentina’s woes of high debt, disease

• As matters stand, the pandemic will likely leave several other countries with distressed debt that will have to be resolved to secure an economic recovery
• But many of these countries will lack the Argentine government’s capacity to ensure a level playing field for negotiations, given that its 2020 restructuring benefited from support from influential players

Getting back on the Paris climate track

• Despite all the recent turmoil, one certainty remains: the climate crisis and the need to stick with the Paris accord, which is the only road map that we have for decarbonizing the global economy.
• With entire economies and societies changing fast, this is the moment for political leadership to push things across the finish line.

Latin America’s pandemic of mounting troubles

• Overall, Latin America’s underperformance during the pandemic has revealed pervasive shortcomings in state capacity that extend far beyond the region’s obviously weak health systems
• Latin America’s virus contagion curve may be flattening, but its poverty and business bankruptcy curves continue to rise

Poor reading of American capitalism

• Rarely does one hear about upward redistribution, whereby a few cents taken from everyone make a few individuals very rich indeed. Worse, the 2020 US election all but ensures that this 'trickle-up' dynamic will continue
• American capitalism’s potential to foster innovation and well-being remains unlimited, but its flaws are literally draining the life from many Americans