Seung Jin Baek is an Economist at the United Nations and holds a PhD from the Department of Social and Policy Sciences at the University of Bath.
Over the past months and year, the entire world has suffered from shutdown, self or institutional quarantine, the collapse of medical systems, teleworking challenges, economic downturn, and many other developments to which we had previously given little thought, if any.
Nonetheless, we have also proved ourselves in terms of having the resilience, determination, and solidarity to overcome such hardships observed across many countries in the world. What we have confronted and gone through together has given rise to new perceptions and emerging trends in the fields of politics, economy, industry, education, health, and the environment. In other words, it has become clearer that we, the people, should respond proactively rather than fear the upcoming ‘new normal.’
We need to unravel our new way of viewing the future we are facing; explore several potential policy considerations at the national level; and dissect the likely-to-be redefined future narrative of the post-COVID-19 era.
Smart government for a newly redefined national security context
Despite its many uncertainties, the COVID-19 crisis is arguably an ideal opportunity to redefine the role of the state. We have clearly observed and sometimes experienced that the safety of people is directly affected by the governance and institutional quality of individual governments. In parallel, citizens will have more room to tolerate any form of state intervention if it helps to ensure their lives and safety.
During its crisis response, national governments seem to have secured justification to intervene regarding various state-led public health and socioeconomic interventions. Accordingly, a series of strong measures would in turn generate a great opportunity to strengthen its public administration capability if it attaches priority to how smart it is to protect people’s lives and safety, and how smartly it can provide public services and support during these difficult times and beyond.
In the new normal era, the concept of competition between nations that has until now been centered on hard power such as the economy and the military, will likely be re-centered on soft power, and our COVID-19 experiences may further emphasise that humanity itself becomes the ultimate goal of national security. Effectively managing various newly and potentially redefined national security concepts, including economic security, food security, health security, environmental security, personal security, community security, and political security would not be possible without a fully functional smart government systematically underpinned by a broad range of modern technology.
With respect to e-governance system, smart government must be capable of facilitating and supporting better planning and decision-making to provide timely quality public services, with a particular focus on public health and cybersecurity, while the rest of the resources available will have to be invested in enhancing the role of the private sector to bring about innovative technology solutions to improve the smart governance system itself. In doing so, national government will have to take a leading role in the smart governance solution by taking advantage of its status as a pioneering e-government system.
Control tower for supply chain resilience
The degree of responsiveness to the rapid dynamics of the restructuring of the global supply chain has become a core capability in the COVID-19 era and will be even more so beyond the crisis’ end. As the current pandemic is seriously disrupting global and regional value chains, a sizeable number of multinational corporations are expected to take action by reshoring or U-turning to their home countries.
According to a survey conducted by the Bank of America, nearly 80 percent of China-based multinational corporations are currently considering reshoring. In effect, many are exposed to serious damage whereby only one supply chain disruption in the global value chain would destroy their business operations due to being closely linked to a globalised division of labor, from production to sales. No wonder, in this regard, that reshoring, or at least a plan to repatriate part of production from one country to another, would be encouraged in terms of supply chain system risk management if the pandemic persists. It should, however, be noted that reshoring or the U-turn option cannot be considered a fundamental solution capable of mitigating such risks. Diversifying the production bases to reduce labor and transportation costs and maintaining an international division of labor that fits the characteristics of each country and relevant businesses would remain essential in achieving global and regional market competitiveness.
Monitoring such likely dynamic trends associated with supply chain disruption is a particularly critical consideration for a country that has maintained its trade performance by relying heavily on a certain group of countries or region. Because of this, line ministries and relevant agencies must closely monitor and assess the changing trajectory in the global and regional supply chain. An integrated national approach to quickly respond to such changing dynamics will most probably be the key to the future prosperity. Hence, the establishment of a nationwide supply chain crisis response centre should be carefully considered. This centre should be fully capable of supply chain resilience planning and management through close cooperation with import/export companies, trade unions, food authorities, and a cooperative society. Full digitalisation of all these processes and the cooperation and integration of innovative technology solutions such as blockchain and artificial intelligence (AI) will be required in the months to come.
Untact culture and industrial restructuring
Reflecting on our radical experiences over the past months and year, there is an increasing desire to enjoy meals and leisure at home as long as social distancing guidelines emphasise that we do so to protect ourselves from COVID-19. We will have to prepare thoroughly for when this so-called untact culture is routinised, something that the COVID-19 crisis will most likely leave behind as part of its legacy. In other words, this pandemic is likely to instill in us a perception that a house where one can control everything is the safest place to be. The spread of such an outlook may influence changes in the structure of service sectors, and hence predicting new demands and responding in advance will be crucial for businesses in preparation for new business opportunities. Meanwhile, there would also be an urgent need for governments to prepare preemptive policy alternatives that effectively respond to anticipated industrial restructuring.
Such prospective restructuring is likely to lead to a new era of distance education. This may consist of blended learning, which combines online and offline education, or flipped learning, in which teachers and students engage in offline discussions after prior online learning. Such methods are expected to become widespread during and after this crisis. Now is the time for national governments to scale up its efforts to promote these newly emerging education-related business opportunities, in collaboration with various concerned businesses. Furthermore, the government should establish a policy whereby teachers are assigned two clear roles: firstly, the role of providing guidance to help students to progress; and secondly, the role of teaching with an additional function of providing psychological support to students as well. Nonetheless, such a policy change and relevant support should consider the feature of public good and address any unequal educational opportunities.
Changes in the ways of working, including video conferencing and telecommuting, are also imperative to consider. Such trends are anticipated to continue, further leading to innovation in terms of office space. Mobile-based 5G smart office business may allow most work tasks to be done on a smartphone and may emerge as a new industry or sector. Besides, an emerging business opportunity for home office arrangements is likely to bring about huge cost reductions for companies all over the world. In other words, a substantial portion of the existing large-scale offices may disappear in the post-crisis era.
In responding promptly to the untact cultural trend, strengthening the capability to maximise the potential of 5G networks and built-in infrastructure is required. In fact, even before this pandemic broke out, many advanced countries had already embraced digitalisation, for example in the extensive use of online banking transactions. Besides, a large proportion of traditional shopping has already been replaced by online and mobile shopping. In this context, it is likely that the current crisis will accelerate such banking and shopping trends, among others. Businesses should thus anticipate this growing trend to capture any foreseeable opportunities by improving their online transaction capabilities and platforms.
Discourse for environmentally friendly dual transformation
The COVID-19 pandemic indeed feels like a warning to humanity for having prospered through indiscriminate development and exploitation of the environment and natural resources. Following the emergence of climate change, largely caused by growth models centered on fossil fuel energy, this pandemic can be considered as nature’s counterattack. Paradoxically, this crisis can actually present the opportunity for us to realise the preciousness of Earth, home to 7.7 billion people. It may also be an opportunity for us to move towards a people-and-environment-centered development initiative. The experience of the pandemic may put into perspective environmental development, which has long been treated as less of a priority than economic development. In other words, COVID-19 may bring about the restoration of the idea of living for/with the environment. This is likely to be accompanied by ecological living and favouring the de-urbanisation phenomenon. The fact that we are experiencing the collapse of the traditional office working culture and are now able to work from home in a sustainable manner should force a rethink of our routines and our priorities. It is thus time to the environmental discourse at the national level since the state of the environment will have great implications for various dimensions of the national development planning framework.
This environmentally-friendly development discourse would provide national governments with firm justification to accelerate the process of economic transformation, moving away from the traditional development model. Realising it would require rapid and transformative leadership with a visionary mindset of promoting three dimensions of sustainable development: social, economic, and environmental. Devising a new arrangement of institutional architecture may be an effective strategy in this regard. For example, a special task-force team under the Prime Minister’s Office could be institutionalised to coordinate all eco-friendly government policies that are aligned with dual transformation initiatives (the economic and digital transformations). This special team must be capable of acting as a policy control tower to primarily focus on policy coordination by creating synergies between environmental development and the dual transformation agendas. The special unit must be capable of conducting extensive training, advocacy, and campaigns to educate the general public and governmental institutions about the synergic effects of designing, coordinating and implementing policies informed by environmentally-friendly dual transformation.
This blog gives the views of the author, and not the position of the United Nations, University of Bath, nor the Institute for Policy Research (IPR).