2020s in economic history
It has been attributed to various causes, including pandemic-related economic dislocation; the fiscal and monetary stimulus provided in 2020 and 2021 by governments and central banks around the world in response to the pandemic were also instrumental.The price war was triggered by a break-up in dialogue between the Organization of the Petroleum Exporting Countries (OPEC) and Russia over proposed oil-production cuts in the midst of the COVID-19 pandemic.In 2021, record-high energy prices have been reached, due to a global surge in demand as the world quit the economic recession caused by COVID-19, particularly in Asia.[39] The Federal Reserve established a Bank Term Funding Program (BTFP) to offer loans of up to one year to eligible depository institutions pledging qualifying assets as collateral.[44] Lina Khan was appointed as the chair of the Federal Trade Commission in 2021 with the promise to tackle American tech corporations for alleged anti-competitive practices.[49] After Jack Ma, the founder of Alibaba Group, criticized the Chinese financial system, he disappeared for three months.[58] The world's largest free trade agreement, the Regional Comprehensive Economic Partnership, was signed on November 15, 2020, including the members of ASEAN, as well as Australia, China, Japan, New Zealand, and South Korea.Virgin Galactic, SpaceX, and Blue Origin began to pioneer in private space travel during the early 2020s.[62] In April 2020, Sub-Saharan Africa appeared poised to enter its first recession in 25 years, but this time for a longer duration.[73] In 2021, the People's Bank of China ruled that all financial transactions and activities involving cryptocurrency are illegal in the country.[75] The new regulations greatly affected the property developer Evergrande Group, which had historically used large amounts of borrowing to become successful.On 31 August 2020, the National Statistical Office (NSO) released the data, which revealed that the country's GDP contracted by 23.9 per cent in the first quarter of 2020–21 financial year.[82] This adds to the effect of the pandemic on people's lives and the economy, the prime minister unveiling a 'massive" stimulus amounting to 20% of GDP.[83] After a period of modest recovery in 2020 and early 2021 amid the COVID-19 pandemic, the Turkish lira plunged following the replacement of Central Bank chief Naci Ağbal with Şahap Kavcıoğlu,[84] who slashed interest rates from 19%[85] to 14%.The fall of the exchange rate caused the 2019–2021 Lebanese protests, which ultimately resulted in the resignation of the prime minister and his cabinet.[92] In 2021, El Salvador became the first country to accept Bitcoin as legal tender, after the Legislative Assembly votes 62–22 to pass a bill submitted by President Nayib Bukele classifying the cryptocurrency as such.[93] Pemex was awarded control of a privately discovered oil field by the Mexican government as part of Andrés Manuel López Obrador's "nationalistic" energy policy.[107][108] The United States Department of Commerce reported that consumer spending fell by 7.5 percent during the month of March 2020.[109] The largest economic stimulus legislation in American history, a $2 trillion package called the CARES Act, was signed into law on 27 March 2020.[110] The Congressional Budget Office reported in May 2020 that: In June 2020, economic analyst Jim Cramer said that the response to the COVID-19 recession has led to the biggest transfer of wealth to the ultra-wealthy in modern history.[113] Venezuela launches its second monetary overhaul in the past three years by cutting six zeros from its currency in order to simplify accounting.[115][116] The JobSeeker Payment unemployment benefit base rate was almost doubled in April when it had a Coronavirus Supplement of A$550 added to it,[117] but Prime Minister Scott Morrison said that this would likely be reduced when the pandemic ends.[119][120] The package consists of multiple parts, a one-off A$750 payment to around 6.5 million welfare recipients as early as 31 March 2020, small business assistance with 700,000 grants up to A$25,000 and a 50% wage subsidy for 120,000 apprenticies or trainees for up to 9 months, A$1 billion to support economically impacted sectors, regions and communities, and A$700 million to increase tax write off and A$3.2 billion to support short-term small and medium-sized business investment.The JobKeeper program would pay employers up to A$1500 a fortnight per full-time, part-time or casual employee that has worked for that business for over a year.This massive loss in jobs caused the myGov website to crash and lines out of Centrelink offices to run hundreds of metres long.[125] On 23 July 2020, Josh Frydenberg delivered a quarterly budget update stating the government had implemented a A$289 billion economic support package.[128][129] On 22 February 2021, Prime Minister Scott Morrison announced that the JobSeeker Payment base rate would be increased by A$50 a fortnight from April 2021.[146] A day later, the Chancellor of the Exchequer Rishi Sunak announced the government would spend £350 billion to bolster the economy.[150] April's Purchasing Managers' Index score was 13.8 points, the lowest since records began in 1996, indicating a severe downturn of business activity.