Emerging markets have been mostly absent from the global conversation about special measures to combat coronavirus-induced recession. This makes little sense, because they are uniquely vulnerable in the pandemic. Greater efforts must be made to help them.
Rich nations can tap their central banks. Poor nations can benefit from the G20’s debt relief initiative. But the 106 countries in the middle, accounting for three-quarters of the world’s population, cannot count on debt forgiveness or central bank largesse to fund big spending programmes. Yet it is precisely these countries which stand to be hardest hit by coronavirus.
Seven of the 10 nations with the highest number of Covid-19 infections globally are developing countries. The lockdowns which have contained infection in richer countries are far less effective in emerging markets. Several have in effect given up trying to contain the virus. Middle-income nations entered this crisis in poor shape. Pre-existing conditions included high debt levels, stagnating economies, struggling public health systems and serious inequality. Latin America was worst off, but parts of the Middle East, south Asia and Africa were also far from fit.