The deep economic recession triggered by COVID-19 continues to have profound economic and social consequences. Since the outbreak of the pandemic, unemployment rates have rapidly increased in most developing and advanced economies, and poverty rates have begun to rise again, reversing the gains achieved over the past few decades. According to the latest estimates, the economic and health crisis triggered by COVID-19 is expected to push between 88 million and 115 million more people into extreme poverty in 2020.1 When looking at working hour losses experienced by the global economy, 245 million full-time jobs are expected to be lost globally by the end of 2020, which amounts to a loss of the productive capacity of 8.6% of the global workforce.2 The crisis has also revealed the inadequacies of existing infrastructure and policies, ranging from social protection systems to healthcare.

The global economic outlook for 2021 is highly dependent both on the evolution of the pandemic and on the effectiveness of the recovery strategies of governments. In this unique context, we aim to explore how countries can expand their focus beyond a return to growth and to consider how to “build back better” in this special edition of the Global Competitiveness Report Special Edition 2020. The report looks at priorities for economies across three timeframes: those of the last decade as revealed by timeseries data on factors of competitiveness, those that are critical for economic revival as revealed by the crisis and those that could help embed a transformation that may lead to better outcomes for productivity, shared prosperity and sustainability.

There have been unprecedented fiscal, monetary and regulatory policy measures that have provided households and businesses with emergency income and cashflow support, with governments deploying close to $12 trillion globally since the beginning of the global pandemic. As existing support measures begin to expire in several countries, it is paramount to set in place the structural reforms that can support economies as they transition onto a path of recovery. It may be tempting to consider the rebound in GDP that several economies are experiencing as lockdowns measures are lifted as a sign of a swiftly achievable recovery. Instead, the road towards economic recovery will be long, asymmetric and asynchronous across different economies, and can be proactively shaped and managed for optimal outcomes for productivity, people and the planet.

The World Economic Forum has long been at the forefront of looking beyond GDP as the key benchmark of success, espousing longer-term and holistic thinking through the Global Competitiveness Index, emphasizing equality in the economy through the Gender Gap index, assessing economies against inclusion criteria through the Inclusive Growth Index and promoting the concept of socioeconomic mobility in the economy through the Global Social Mobility Index. Most recently, the Dashboard for a New Economy framework aims to promote an expanded set of targets that focuses on prosperity, people, planet and institutions.

The Global Competitiveness Report Special Edition 2020 series has, since its first edition, aimed to move focus beyond the growth-only paradigm and has been central at pointing out the need for public-private collaboration. The Global Competitiveness Index (GCI) contained in the report has continued to evolve along with the latest economic thinking, the needs of society and technological developments. The Global Competitiveness Index 4.0—launched in 2018—incorporates a wide-ranging focus on a broad range of factors of productivity. That year, we demonstrated that in the longer run there is a win-win-win between driving growth, creating better functioning societies and enacting measures to improve the environment. In 2019, we used a GCI timeseries to show that, despite the massive injection of liquidity by central banks since the financial crisis, improvements in the factors of productivity had stalled.

This year’s special edition aims to support the recovery strategies of policy-makers, calling for a holistic approach, encompassing several policy areas and establishing synergies across different reform objectives. The special edition does not provide country rankings, due to missing data from various international organizations as well as the need for new thinking regarding the economic recovery after the COVID-19 shock. Instead this edition takes into account the unique context and priorities emerging from the pandemic as well as the priorities that had already become clear before the crisis, such as the need for combining productivity with better outcomes for people and the planet. As such, it lays the foundations for a new direction to support policy-makers and other leaders to define how to "build back better".

This report is structured around six sections. The first four sections analyse past and current trends by broad thematic areas that are the key building blocks of an economy: Enabling Environment, Human Capital, Markets, and Innovation Ecosystem. Within each of these thematic areas, priorities are presented for policy-makers to consider in order to develop productive, shared prosperity-enhancing and environmentally compatible economic systems. These priorities are organized into three timeframes: i) the past 12 years, assessing the evolution of key drivers of sustainable and inclusive productivity since the financial crisis, including the short-term shock impact of the COVID-19 crisis; ii) the next two years (revival), which looks at priorities to restart the economy while embedding criteria for longer-term productivity, inclusion and sustainability beyond immediate responses to the COVID-19 crisis; iii) the next 3-5 years (transformation), which looks at the priorities for economic systems that fully integrate social and environmental targets into policy design. The fifth section of the report presents a first attempt to assess countries’ readiness to achieve future transformation across all four thematic areas. The sixth section, through the lens of the Executive Opinion Survey, examines the disruptions caused by the crisis and identifies common elements of countries' resilience. The report draws upon the Executive Opinion Survey, a key tool to provide the opinion of business leaders on their economies. We supplement this analysis with publicly available data from international organizations. For economic systems to be geared towards delivering positive outcomes in the form of better productivity, shared prosperity and working within planetary boundaries, our tools, metrics and benchmarks of success must also change. As we look to 2021, we will further develop on the foundations provided in this special edition to further refine a new ‘compass’ for future economic growth.