IMF Forecasts Negative Global Growth for 2020
The International Monetary Fund (IMF) has predicted negative growth for 2020 and says it expects at least a recession or worse global financial crisis.
The prediction is a result of the huge economic impact of the novel coronavirus on the global economy.
Economic Analysts in Hong Kong have said that the virus could cost China’s economy $60 billion dollars by this quarter whiles Oxford Economics warns that with the virus being declared a pandemic, the global economy could be affected by $1.1trillion dollars.
The IMF, however, expects countries to recover in 2021.
“To get there, it is paramount to prioritize containment and strengthen health systems everywhere. The economic impact is and will be severe, but the faster the virus stops, the quicker and stronger the recovery will be.”
The IMF’s viewpoint follows a conference call meeting with G20 Finance Ministers and Central Bank Governors.
Managing Director of the IMF, Kristalina Georgieva said countries need to work together to limit the economic damage.
“The human costs of the Coronavirus pandemic are already immeasurable and all countries need to work together to protect people and limit the economic damage. We strongly support the extraordinary fiscal actions many countries have already taken to boost health systems and protect affected workers and firms. We welcome the moves of major central banks to ease monetary policy. These bold efforts are not only in the interest of each country but of the global economy as a whole. Even more will be needed, especially on the fiscal front,” she said.
She added that “advanced economies are generally in a better position to respond to the crisis, but many emerging markets and low-income countries face significant challenges.”
How is the IMF planning to address the setbacks on the Global Economy?
Commenting on plans of the IMF, Mrs. Georgieva said the IMF is concentrating on bilateral and multilateral surveillance on the crisis and policy actions to address its impact.
As an additional measure, the Fund will massively step up emergency finance,
“Nearly 80 countries are requesting our help, and we are working closely with the other international financial institutions to provide a strong coordinated response. These are extraordinary circumstances. Many countries are already taking unprecedented measures. We at the IMF, working with all our member countries, will do the same. Let us stand together through this emergency to support all people across the world.”