The writer is professor of finance at the Chicago Booth School of Business and author of ‘The Third Pillar’
Industrialised Europe and east Asia seem to have contained the first wave of the virus. News elsewhere is bleaker. Brazil is an unfortunate standout, vying with the US for the largest number of identified new cases. Cases in south Asia, Latin America and, increasingly, Africa, are climbing. Death rates in these less-industrialised countries are still relatively low. But the economic damage they will suffer is higher.
Given actual or perceived fiscal constraints, few of these countries supported poor households or small and medium-sized businesses significantly during lockdown. Many also opened up before they contained the virus, in order to prevent further economic damage. But their recoveries are weak. Fear and uncertainty have kept domestic consumers at home. Disrupted trade, foreign investment and tourism have curbed overseas demand.