Home Politics The canary in the coal mine of the global economy is small...

The canary in the coal mine of the global economy is small states, and they are struggling


By Philip Kenworthy, Patrick Kirby, Dana Vorisek

Small states—countries with a population of 1.5 million or less—were hit particularly hard by the COVID-19 pandemic.  They’ve also had a much slower recovery than other emerging market and developing economies (EMDEs). Small states have several features that make them especially vulnerable to global economic and climate-related developments. To make matters more difficult, these countries have fewer policy tools at their disposal than larger countries.

A deep contraction during the pandemic, and a prolonged recovery

Small states are forecast to grow 3.5 percent in 2023, slowing from an estimated 5.2 percent in 2022. At the projected pace of growth, small states will regain their aggregate 2019 level of activity only this year, while other EMDEs exceeded this threshold in 2021 (Figure 1). Small states face long-term economic damage related to the shocks of the previous three years, including skills and education losses, a lower capital stock, and damage from the protracted downturn of tourism.

Figure 1. GDP compared to pre-pandemic levels

Source: World Bank.
Note: Sample includes 34 EMDE small states (excluding Guyana), 115 EMDEs excluding small states, and 37…

Read more…

Previous articleInterior Department Blocks Minnesota Twin Metals Mining Project In Big Win For Beijing
Next articleAn archeologist discovers a 4,300-year-old Egyptian mummified, and dozens of other relics