{ "title": "From Great Lockdown to Great Transformation", "publication": "IMF News, June 9, 2020", "sourceUrl": "https://www.imf.org/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation", "canonical": "https://www.imf.org/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation", "overlayPath": "/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation/index.md", "summary": "The current crisis is a truly global shock: by the end of 2020, \"170 countries—almost 90 percent of the world—will be worse off with lower per capita income.\"", "publishDate": "2020-06-09", "sections": [ { "heading": "Lessons from the Great Lockdown", "content": "- The current crisis is a truly global shock: by the end of 2020, \"170 countries—almost 90 percent of the world—will be worse off with lower per capita income.\"\n- This outcome reverses the IMF forecast from January that \"160 countries would finish the year with larger economies, and positive per capita income growth.\"\n- The period is labeled \"the Great Lockdown\" because the health emergency has forced production and consumption to a standstill—\"this has never been done before.\"\n- Global fiscal response: \"massive fiscal measures—totaling nine trillion dollars, globally.\"\n - These measures are characterized as temporary lifelines and \"a bridge to the recovery, but not a risk to the recovery as it arrives.\"\n- Central banks acted forcefully, with the U.S. Federal Reserve providing liquidity and calming markets.\n- Capital flows and market access:\n - In March, \"around one hundred billion dollars left emerging markets and developing countries—three times more than during the global financial crisis.\"\n - In April and May, \"total issuance of around seventy-seven billion dollars\" from emerging markets—\"almost three and a half times as much as in the same two months last year.\"\n- Countries with buffers and sound macroeconomic policies have weathered the crisis better; those in debt distress, affected by fragility and conflict, or with weak fundamentals are at much higher risk.\n- Public health response: health systems are being expanded to cope with increased demand; behavioral adaptations (social distancing, masks) are becoming widespread." }, { "heading": "Pathway to Recovery and Opportunities", "content": "- Reopening status: \"some 75 percent of countries are now reopening.\"\n- The choice for recovery: \"building forward—not back\" towards \"a great transformation.\"\n- Key risks emerging from the crisis:\n - Higher debt and higher deficits.\n - \"In all likelihood—higher structural unemployment and higher levels of poverty.\"\n - Need to assess capacity to carry debt over time and ensure sustainability despite low interest rates.\n- Major opportunities to accelerate during recovery:\n - Digital transformation:\n - Rapid modernization of work (telecommuting, flexible organization).\n - Expansion of \"e-commerce, e-learning, e-transfers, e-payments, and e-governance.\"\n - Risk of a \"great divide\" if access to digital skills and infrastructure remains unequal; example: \"currently only 50 percent of African businesses and citizens have access to the Internet.\"\n - Green transition:\n - The green economy can create jobs (examples: \"insulating buildings, in reforestation, or in planting mangroves\").\n - \"Low carbon energy and infrastructure can also be a big booster for jobs.\"\n - Fund interest in providing incentives and clarity around \"the risks to businesses during the transition to a low carbon economy.\"\n - Building fairer societies:\n - Policies that are both pro-growth and equity-enhancing (combining social safety nets with \"social safety ropes\" and targeted support to small and medium-sized businesses).\n - Warning that \"inequality tends to go up after a pandemic.\"\n- Globalization:\n - Caution against a retreat from globalization despite pressures to build national health security and independence; global trade contributes to \"lower costs, higher incomes and lower\" (text ends mid-sentence in source)." }, { "heading": "IMF Response and Role", "content": "- The IMF has stepped up its support and is deploying resources with speed and impact.\n- Post-Global Financial Crisis strengthening: resources increased \"from $250 billion to $1 trillion – four times as strong.\"\n- Operational response:\n - Providing emergency financing to countries most in need.\n - Offering flexible credit lines to countries with strong fundamentals.\n - Poised to do more and soliciting input on priorities for the Fund's contribution to recovery.\n\nIMF Managing Director’s Opening Remarks, US Chamber of Commerce, June 9, 2020\n\n---\n\n\n References\n\n- https://www.imf.org/en/about/senior-officials/bios/kristalina-georgieva\n- Bulgaria and the IMF\n- United States and the IMF\n- Speeches\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation" } ], "bullets": [ "[Markdown version](/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation/index.md)", "[Structured JSON version](/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation/index.json)", "[Bundle manifest](/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation/bundle-manifest.json)", "Published: June 9, 2020", "The current crisis is a truly global shock: by the end of 2020, \"170 countries—almost 90 percent of the world—will be worse off with lower per capita income.\"", "This outcome reverses the IMF forecast from January that \"160 countries would finish the year with larger economies, and positive per capita income growth.\"", "The period is labeled \"the Great Lockdown\" because the health emergency has forced production and consumption to a standstill—\"this has never been done before.\"", "Global fiscal response: \"massive fiscal measures—totaling nine trillion dollars, globally.\"", "Central banks acted forcefully, with the U.S. Federal Reserve providing liquidity and calming markets.", "Capital flows and market access:", "Countries with buffers and sound macroeconomic policies have weathered the crisis better; those in debt distress, affected by fragility and conflict, or with weak fundamentals are at much higher risk.", "Public health response: health systems are being expanded to cope with increased demand; behavioral adaptations (social distancing, masks) are becoming widespread.", "Reopening status: \"some 75 percent of countries are now reopening.\"", "The choice for recovery: \"building forward—not back\" towards \"a great transformation.\"", "Key risks emerging from the crisis:", "Major opportunities to accelerate during recovery:", "Globalization:", "The IMF has stepped up its support and is deploying resources with speed and impact.", "Post-Global Financial Crisis strengthening: resources increased \"from $250 billion to $1 trillion – four times as strong.\"", "Operational response:", "[https://www.imf.org/en/about/senior-officials/bios/kristalina-georgieva](https://www.imf.org/en/about/senior-officials/bios/kristalina-georgieva)", "[Bulgaria and the IMF](http://www.imf.org/external/country/BGR/index.htm)", "[United States and the IMF](http://www.imf.org/external/country/USA/index.htm)", "[Speeches](https://www.imf.org/en/news/searchnews)", "[PRESS CENTER](http://presscenter.imf.org/)", "[https://www.imf.org/en/home](https://www.imf.org/en/home)" ], "alternates": { "markdown": "/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation/index.md", "json": "/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation/index.json", "bundleManifest": "/en/news/articles/2020/06/09/sp060920-from-great-lockdown-to-great-transformation/bundle-manifest.json" }, "generatedAtUtc": "2026-09-25T23:43:59.527Z" }