Short-term impact of the Covid-19 pandemic on the global and Turkish economy

Abstract

Background/aimThe Covid-19 pandemic is one of those rare events that affects everyone on earth and changes our lives. The pandemic, which has killed over four million people worldwide, is putting unprecedented pressure on governments to maintain essential health and social services, as well as keep their economies running, even as the virus threatens people’s daily life on every level. Thus, the purpose of this study is to discuss the short-term economic impact of the pandemic by assessing its costs using official economic data for both the world and Turkey. Furthermore, this research highlights possible economic, social, and political pathways for a postpandemic new world.Materials and methodsThis study is a review article that overviews and tracks the economic development of the Covid-19 pandemic from the start, synthesizes and compares current data of reliable institutions, and provides an overall assessment.Results The pandemic has certainly caused short-term and long-term damage to economies and living standards for many people. Although there are estimates on what this damage is, the exact degree of the damage is still unknown. However, it seems that the recovery will be gradual, long-lasting, and unpredictable due to the unprecedented uncertainty characteristic of the pandemic.ConclusionEarly economic growth projections show that there will be no ordinary recovery for the world economy since short-term countries’ recovery paths are different. It is likely to remain uneven and depend on the effectiveness of the vaccination process, fiscal policy support, public health management, and hard-hit sectors’ growth size in economies. Due to the uncertainty and lack of confidence, governments should ensure an equal and sustainable economic recovery from the Covid-19 pandemic by conducting flexible monetary and fiscal policies. However, without structural reforms, economies can not boost either in the short-term and long-term.