Optimism for world economy in 2022 is drying out – Debapriya Bhattacharya

Originally posted in Prothom Alo on 31 January 2022

Dhaka Tribune-BIPSS roundtable
Meeting the challenge of emerging global trends

The world has been undergoing extensive changes in the past few years, even more so after the outbreak of the Covid pandemic. Given the manner in which all countries, big and small, are interlinked across the globe, there is an overarching need to understand the emerging global trends and address the critical issues. These observations were made at a roundtable on ‘Global Trends 2022’, organised jointly by Dhaka Tribune and BIPSS on Sunday 30 January 2022 at The Westin in Dhaka.

Picking up on trade and economic trends, economist Debapriya Bhattacharya, distinguished fellow of the Centre for Policy Dialogue (CPD), said the major dimension of global trends at present is the pandemic and vaccinations. He pointed to the disparity in vaccinations, saying that while in the developed world, 2 out of 3 persons were vaccinated, in the developing world this was 1 out of 9. The question was whether this gap would reduce in the coming days. Men were more vaccinated than women, the urban population more than the rural.

Continuing on the vaccine issue, he said, “The cost of the vaccine remains an enigma to us. It is said to cost between 2 dollars to 40 dollars, depending on the source. A way to reduce costs is to do away with the intellectual property rights, even if just for some time. The US is on board about this, but the EU is reluctantly coming on board. But there are other problems too involving raw materials, manufacturing, cold storage chain and so on.” He felt that inequity in vaccine priorities will persist and new variants of the virus would remain a problem globally, and an important challenge to Bangladesh.

Coming to the issue of economic trends, Debapriya Bhattacharya said we have entered the third year of the pandemic. The year 2020 was a disruptive year. Then in 2021 things were being managed and optimism went up towards the end. “Unfortunately that optimism is now withering,” he said, pointing to various negative trends like the supply and demand imbalance, the commodity crisis, increasing costs in bank lending which was driving financial flows to developed countries, falling remittances and unfavourable trade trends.