Some of the key insights were:
- The panel unanimously agreed that the global economy had been simmering in the background for quite some time. Corporate debt had reached historic levels by the end of 2019 and global economies were moving into troubled waters. The panel agreed that the pandemic layered on top of significant market disruptions that already existed.
- The need for strong leadership by governments and business leaders in the face of adversity was reinforced throughout the discussion. Edwin Tong SC, Minister for Culture, Community and Youth, and Second Minister for Law in Singapore, spoke candidly about the level of intervention by the Government of Singapore in private contracts, something that had never previously been seen before. The pandemic resulted in the sharpest quarter to quarter economic contraction in the nation’s history. Faced with economic turmoil, the government told landlords that they could not enforce their contractual rights and went to the extent of purchasing the obligations of two months of commercial rent from landlords. Liberal tribunals and assessors were also introduced in an effort to reach amicable resolutions between parties without the need for court intervention.
- World Bank statistics confirmed the importance of identifying ‘zombie’ companies that have arisen throughout the pandemic. The panel concurred that policymakers should attempt to prevent the proliferation of zombie firms as they deprive healthy businesses of credit facilities.
- The panel noted the sudden nature of the pandemic and that it represents a learning curve for all nations. Simon Freakley (Alix Partners LLP) asserted that the pandemic was more akin to an asteroid hitting the earth as nobody (with the possible exception of Bill Gates) saw it coming. Khathutshelo Mapasa (CEO, Basil Read Group) drew a humorous analogy between the pandemic and Mike Tyson’s infamous quote that “everyone has a plan until they get punched in the mouth!“
- In conclusion, the overriding takeaway of the discussion was that the full impact of the pandemic on the global economy remains unknown and nations should work together to employ the correct strategies and policies to ensure economic survival.
