For many observers, the best strategy to build back better after the COVID-19 crisis is to double down on pre-pandemic policies: at the domestic level through market disciplines to contain production costs, especially of labour and taxes; internationally, by reforming the WTO to further trade liberalization, secure intellectual property and contain state subsidies.
This paper argues that this prescription is flawed by weak economic analysis and selective choice of data, and that a different reform agenda is urgently needed if developing countries (but also many in the developed world) are to recover better from the COVID-19 crisis, build resilience to future shocks and achieve transformative development that can deliver the SDGs.
The agenda outlined is centred on a recovery strategy to boost domestic demand, jobs and household incomes, and a diversification strategy into higher productivity sectors. The discussion focuses on developing countries.
