IMF projects global economy to contract in 2020
The COVID 19 global pandemic crisis has not spared any country. According to IMF, due to the pandemic, the global economy is projected to fall to –3 percent in 2020, much worse since the Great Depression and far worse than the Global Financial Crisis during 2008–09 . Should the pandemic fade in the second half of 2020 and efforts to contain the virus are successful , IMF projects that the global economy will grow by 5.8 percent in 2021.
The cumulative loss to global GDP over 2020 and 2021 from the pandemic crisis could be around $9 trillion, greater than the economies of Japan and Germany combined.
Both advanced economies and emerging and developing economies are in recession. For 2020 growth in advanced economies is projected at minus 6 percent, emerging market and developing economies are also projected to have negative growth of minus 1 percent; and minus 2.2 percent.
China’s growth is projected to decline from 6.1 percent in 2019 to 1.2 percent 2020. As a comparison, China’s growth performance during the Global Financial Crisis, which was little changed at 9.4 percent in 2009.
According to forecast by IMF, GDP in the Euro area will contract by 7.5% this year.
The uncertainty about what happens next remains.