The development of the global economy faces various challenges as the COVID-19 pandemic wreaks havoc worldwide and the de-globalizing trend is becoming ever stronger, experts said in an interview on Thursday with China Global Television Network (CGTN).
In the interview, Jimmy Zhu, chief strategist at Fullerton Research and James Early, CEO of Stansberry China, shared their views on how the world economy might evolve amid the pandemic and what the future path might be for the economic ties between China and the United States, the two major countries now accounting for over one-third of global economic output and over 50 percent of global growth.
Amid the pandemic, governments worldwide are striking a balance between reopening the economy and curbing the spread of the virus.
“Well, it’s a very difficult balance. In the beginning, people think, ‘Okay it’s a half-half’. But what we look at is once you need to open a business, especially the restaurants, the bars, it’s very easy to transition. So I think before the vaccine out finally, I mean I got to say, I hope it’s not, but it seems like it’s very difficult to balance the two. So sometimes the policymakers need to be a bit prudent or a bit flexible when dealing with such things,” Zhu said.
Beyond the epidemic, Early reckoned that the de-globalizing forces are growing worldwide, setting even more barriers for the free flow of trade.
“Well look, we will definitely have less of it and that’s just the bummer. As a simple example, I was looking at my iPhone and imagine if everybody had to make their own iPhone, it would just be so inefficient. Right? The globalization brings us great benefits. But to switch analogies, I was at the beach a few years ago and when I saw these little crabs and they were very timid. As soon as they got scared, they go into their hole. But then gradually they’d come back out again. And I think we’ll see the same thing with nations, meaning, we are de-globalizing, period. That’s happening, but it’s not really complete and it’s only going to probably be less than 10 year cycle, which is short in terms of humanity. And I think then things will start to move again. But it’s going to be a painful 10 years, and I think it’s going to teach us how precious that trade and globalization really is, because maybe we don’t value it enough right now,” said Early.
