Populist politicians, who have been sweeping to power in countries across the globe, build their appeal partly on claims that they will base their policies on the needs and interests of the people. But once in power, their decisions, often ill-conceived, can create grave problems for the very voters they purport to champion. For proof, look no further than what has befallen the people of Sri Lanka. In recent months, life in the island nation has turned into a grinding, ever-worsening ordeal. What started as a government debt crisis has devolved into broader economic turmoil, marked by critical shortages of [...]
One of the more concerning things about the virus that causes COVID-19 is the potential for its symptoms to linger long after the initial infection has waned. No one knows exactly what is causing “Long COVID,” as the disease is now known, but we do know that dealing with it will impose costs on societies for years to come. Not dissimilar are the pandemic’s economic and financial impacts. The initial symptoms of the crisis were acutely painful—economic downturns, business closures and supply chain disruptions. But now, as governments reopen their societies, they are realizing that some of the pandemic’s challenges may not [...]
In mid-February, the World Bank issued a warning: Many low-income countries hit hardest by the pandemic are now on the brink of serious debt crisis, complicating the global economic recovery from the COVID-19 pandemic. While worries about the accumulated burden of sovereign debt and the possibility of a debt crisis have been present for years, the pandemic has exacerbated an already precarious situation for many low-income countries, revealing fundamental flaws in the current architecture for sovereign debt restructuring. These flaws are likely to become more evident in 2022, as Russia’s invasion of Ukraine contributes to higher global energy and food prices, [...]
