Connect with us

International

World economy shrinks by 3% due to coronavirus

Published

on

 


Franklin Delano Roosevelt Memorial, bronze statues representing the Great Depression, waiting in a bread line by George Segal, Washington D.C, United States.

UniversalImagesGroup | Getty Images

The global economy will likely experience the worst financial crisis since the Great Depression this year, the International Monetary Fund said on Tuesday as governments around the world grapple with the Covid-19 pandemic.

The Washington-based organization expects the world economy to contract by 3% in 2020. However, in January, it had forecast growth in world GDP (gross domestic product) of 3.3% for this year.

“It is very likely that this year the world economy will experience its worst recession since the Great Depression, surpassing that of the global financial crisis ten years ago,” said Gita Gopinath, chief economist of the IMF, in the latest World Economic Outlook report. .

In January, the IMF had estimated growth of 3.4% of world GDP in 2021; it has now been revised to 5.8% (although growth is expected to come from a weaker base after the contraction forecast for 2020).

“A partial recovery is forecast for 2021, with growth rates above trend, but the level of GDP will remain below the trend before the virus, with considerable uncertainty as to the strength of the rebound,” said Gopinath.

This year’s dramatic deterioration in growth forecasts comes as other institutions also warn that the coronavirus epidemic poses enormous economic challenges. The World Trade Organization said last week as world trade contracts between 13% and 32% this year. The Organization for Economic Co-ordination and Development has also warned that the economic repercussions of the virus will be felt “for a long time”.

To contain the spread of the virus, many governments have put in place lockouts, allowing only people to leave their homes to buy groceries, medicines and, in some cases, to exercise. As a result, commercial activity has stopped in many countries.

The scale and speed of the collapse of the activity that followed (the foreclosure) is unlike anything we have experienced in our lifetime.

Gita Gopinath

IMF Chief Economist

The IMF, which dubbed the current crisis “the big lockdown,” said “this is a crisis like no other.” At a press conference on Tuesday, Gopinath explained “the scale and speed of the collapse of the activity that followed (the foreclosure) is unlike anything we have experienced in our lifetime . “

There is great uncertainty about the duration and intensity of the economic shock, he added, and stimulating economic activity is more difficult given the policies of social distancing and isolation required.

The IMF said it had received “an unprecedented number of calls for emergency funds”. Of its 189 members, more than 90 of them have requested financial support.

The fund, which provides financing to members in economic difficulty, has a lending capacity of $ 1 trillion.

The euro zone will be the most affected

The latest IMF forecasts suggest that the U.S. economy will shrink 5.9% this year. In comparison, the eurozone is expected to shrink 7.5%, but China is expected to grow 1.2% in 2020.

The economic situation will be particularly difficult in Italy and Spain, where GDP is expected to contract by 9.1% and 8% respectively, these two countries being the most affected in Europe by Covid-19. Both have a higher number of infections and deaths than in China, where the virus first appeared in late 2019.

How should governments react?

The IMF advises countries to focus on the health crisis first, spending on tests, medical equipment, and other healthcare costs.

He also said that governments should provide tax deferrals, wage subsidies and cash transfers to the most affected citizens and businesses; as well as to prepare the lifting of the locking measures.

What Are The Main Benefits Of Comparing Car Insurance Quotes Online

LOS ANGELES, CA / ACCESSWIRE / June 24, 2020, / Compare-autoinsurance.Org has launched a new blog post that presents the main benefits of comparing multiple car insurance quotes. For more info and free online quotes, please visit https://compare-autoinsurance.Org/the-advantages-of-comparing-prices-with-car-insurance-quotes-online/ The modern society has numerous technological advantages. One important advantage is the speed at which information is sent and received. With the help of the internet, the shopping habits of many persons have drastically changed. The car insurance industry hasn't remained untouched by these changes. On the internet, drivers can compare insurance prices and find out which sellers have the best offers. View photos The advantages of comparing online car insurance quotes are the following: Online quotes can be obtained from anywhere and at any time. Unlike physical insurance agencies, websites don't have a specific schedule and they are available at any time. Drivers that have busy working schedules, can compare quotes from anywhere and at any time, even at midnight. Multiple choices. Almost all insurance providers, no matter if they are well-known brands or just local insurers, have an online presence. Online quotes will allow policyholders the chance to discover multiple insurance companies and check their prices. Drivers are no longer required to get quotes from just a few known insurance companies. Also, local and regional insurers can provide lower insurance rates for the same services. Accurate insurance estimates. Online quotes can only be accurate if the customers provide accurate and real info about their car models and driving history. Lying about past driving incidents can make the price estimates to be lower, but when dealing with an insurance company lying to them is useless. Usually, insurance companies will do research about a potential customer before granting him coverage. Online quotes can be sorted easily. Although drivers are recommended to not choose a policy just based on its price, drivers can easily sort quotes by insurance price. Using brokerage websites will allow drivers to get quotes from multiple insurers, thus making the comparison faster and easier. For additional info, money-saving tips, and free car insurance quotes, visit https://compare-autoinsurance.Org/ Compare-autoinsurance.Org is an online provider of life, home, health, and auto insurance quotes. This website is unique because it does not simply stick to one kind of insurance provider, but brings the clients the best deals from many different online insurance carriers. In this way, clients have access to offers from multiple carriers all in one place: this website. On this site, customers have access to quotes for insurance plans from various agencies, such as local or nationwide agencies, brand names insurance companies, etc. "Online quotes can easily help drivers obtain better car insurance deals. All they have to do is to complete an online form with accurate and real info, then compare prices", said Russell Rabichev, Marketing Director of Internet Marketing Company. CONTACT: Company Name: Internet Marketing CompanyPerson for contact Name: Gurgu CPhone Number: (818) 359-3898Email: [email protected]: https://compare-autoinsurance.Org/ SOURCE: Compare-autoinsurance.Org View source version on accesswire.Com:https://www.Accesswire.Com/595055/What-Are-The-Main-Benefits-Of-Comparing-Car-Insurance-Quotes-Online View photos



picture credit

ExBUlletin

to request, modification Contact us at Here or [email protected]