Dr. Yaşam Ayavefe on the Effects of COVID-19 on the Economy

There is no doubt that the Covid-19 pandemic has changed everyday life. As we enter the third year of COVID-19, there are several lingering questions:

How many of these changes in our lives will be permanent?
How will life continue when the Covid-19 pandemic is over?
How will a new economy be structured?
How will the balances between the world’s states be shaped?

Of course, considering the order of priority here, unemployment and the future  of the economy are of paramount importance.

Unemployment is High

The most negative impact of the epidemic on all states has been on unemployment. Among the first measures taken when this epidemic occurred, the states were obliged to take measures such as locking down citizens in their homes with the declaration of a state of emergency.

Layoffs of temporary or permanent jobs were made in sectors that experienced massive declines in revenue. Unemployment in all countries barring Cuba and North Korea reached unprecedented rates.

Since 2008, when the global financial crisis occurred, to the beginning of 2020, the unemployment rate in the whole world had entered a downward trend. In fact, by the end of 2019, this rate was 4.79% in developed economies and 5.39% worldwide. In 2020, this figure was 6.48% worldwide, and at the end of 2021, it was 9.8%.

The data obtained show us that the unemployment rate in developing and developed countries has been at its highest levels for the last 14 years. We can assume that this unemployment rate will decrease in the future with vaccination and financial support to employers in the work done by states in the health and economic sense.

Inflation Rates Rise

The global economy has struggled with the emerging wave of inflation, as well as food and energy shortages, which should not be underestimated in 2022. In addition, the effects of the tightening policy of the Central Bank of the United States and some regional problems should be analysed.

Long-standing political tensions present risks that the global economy must meet. The Taiwan tension between China and America and Russia’s invasion of Ukraine are key examples.

Tensions between countries decried as superpowers have frozen relations between the world’s two largest economies and sanctions have been imposed that will affect many countries.

The possibility of early elections in Turkey and the sharp losses in the Turkish Lira and the Brazilian elections will be developments that will be closely watched by those following the world economy.

Find out more about Dr. Ayavefe and his work here:



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