Mubasher: The International Monetary Fund (IMF) expects the global economy will shrink by 3% this year due to the impacts of the new coronavirus (COVID-19), Reuters reported.
The effects of the novel disease on economic activity could mark the steepest downturn since the Great Depression, however, the IMF forecasts a partial rebound in 2021 with economic activity projected to remain below the level expected for next year.
“It is very likely that this year the global economy will experience its worst recession since the Great Depression, surpassing that seen during the global financial crisis a decade ago,” according to a report by the IMF.
The world economy is expected to grow by 5.8% next year, according to the IMF’s 2020 World Economic Outlook report, noting that the expectations come with extreme uncertainty as the outcomes will be depending on the course of the pandemic.
A longer pandemic that lasts through the third quarter (Q3) of the year could cause a further 3% contraction in 2020 and a slower recovery in 2021, the report indicated.