The COVID-19 crisis resulted in a dramatic drop in manufacturing, global demand and incomes, and brought much of global economic activity to a halt. The “Great Lockdown” hurt businesses and engendered a rise in unemployment all over the world.
The closing of borders was particularly detrimental to the service sectors (primarily trade, transportation and tourism), which are a major source of growth and employment for both advanced and emerging economies.
The current crisis has changed the global environment dramatically: accelerated digitalization of economic activity, trade and consumption, and revealed the vulnerability of developing and developed countries to unexpected shocks.
The new environment and global conditions create new challenges to the developing world, exacerbate the fragility of national finances, and jeopardize the achievement of sustainable development goals.
At the same time, it is the cooperation among developing countries, which can potentially become the most effective driver of global transformation in the post-crisis era. Cooperation within the Global South can bolster the revision of the global agenda at the level of existing global institutions, as well as regional integration arrangements.
Cooperation for an effective response to new challenges should proceed at all levels: regional (at the level of integration blocs and regional alliances), trans-regional and global. And in this regard, new forms of trans-regionalisation, such as the BRICS-Plus and the idea of “integration of integrations” within the developing world, become especially promising.
The new multilateral platform, which brings together five BRICS-led integration blocs (Eurasian Economic Union [EAEU], MERCOSUR, South African Customs Union [SACU]/Southern African Development Community [SADC], South Asian Association for Regional Cooperation [SAARC], and ASEAN-China FTA) will potentially contribute to enhancing the cooperation among developing countries as well as consolidating economic integration efforts and financial resources for sustainable growth and better resilience to unexpected shocks.