Triggered by the COVID-19 pandemic, the global economy may likely undergo its worst recession since the Great Depression in the 1930s, and far worse than the 2009 global financial crisis, the International Monetary Fund (IMF) said Tuesday.
"This is a crisis like no other, and there is substantial uncertainty about its impact on people's lives and livelihoods," chief economist Gita Gopinath said in its latest World Economic Outlook report.
Real gross domestic product growth (GDP) is now projected at -3.0 per cent in 2020, a recession much worse than the 0.1 per cent contraction during the 2009 global financial crisis.
The growth forecast is marked down by more than 6 percentage points relative to IMF's January update of 3.3 per cent growth - an extraordinary revision over such a short period.
"The Great Lockdown, as one might call it, is projected to shrink global growth dramatically. A partial recovery is projected for 2021, with above trend growth rates, but the level of GDP will remain below the pre-virus trend, with considerable uncertainty about the strength of the rebound," she said.
Much worse growth outcomes are possible and maybe even likely.
This would follow if the pandemic and containment measures last longer, emerging and developing economies are even more severely hit, tight financial conditions persist, or if widespread scarring effects emerge due to closures and extended unemployment, she warned.
Gita said this crisis will need to be dealt with in two phases: a phase of containment and stabilisation followed by the recovery phase. In both phases, public health and economic policies have crucial roles to play.
"Quarantines, lockdowns, and social distancing are all critical for slowing transmission, giving the health care system time to handle the surge in demand for its services and buying time for researchers to try to develop therapies and a vaccine. These measures can help avoid an even more severe and protracted slump in activity and set the stage for economic recovery," she said.
The chief economist said increased health care spending is essential to ensure health care systems have adequate capacity and resources. Special dispensations for medical professionals -- who are on the frontlines of combating the pandemic -- should be considered, including, for example, education allowances for their families or generous survivor benefits.
While the economy is shut down, policymakers will need to ensure that people are able to meet their needs and that businesses can pick up once the acute phases of the pandemic pass, said Gita.
"This requires substantial targeted fiscal, monetary, and financial measures to maintain the economic ties between workers and firms and lenders and borrowers, keeping intact the economic and financial infrastructure of society."
For example, in emerging market and developing economies with large informal sectors, new digital technologies may be used to deliver targeted support, she added.
Elaborating on the growth outlook, the report released by the Washington-based organisation said growth in the advanced economy group -- where several economies are experiencing widespread outbreaks and deploying containment measures -- is projected at -6.1 per cent in 2020.
Most economies in the group are forecast to contract this year, including the United States (-5.9 per cent), Japan (-5.2 per cent), the United Kingdom (-6.5 per cent), Germany (-7.0 per cent), France (-7.2 per cent), Italy (-9.1 per cent), and Spain (-8.0 per cent).
In parts of Europe, the outbreak has been as severe as in China's Hubei province. Although essential to contain the virus, lockdowns and restrictions on mobility are extracting a sizable toll on economic activity.
Among emerging market and developing economies, all countries face a health crisis, severe external demand shock, dramatic tightening in global financial conditions, and a plunge in commodity prices, which will have a severe impact on economic activity in commodity exporters, said the report.
Overall, the group of emerging market and developing economies is projected to contract by 1.0 per cent in 2020; excluding China, growth rate for the group is expected to be - 2.2 per cent.
The ASEAN-5 -- the biggest economies in ASEAN -- is projected to see their GDP shrink by 0.6 per cent.
-- BERNAMA
Bernama
Wed Apr 15 2020
The growth forecast is marked down by more than 6 percentage points relative to IMF's January update of 3.3 per cent growth - an extraordinary revision over such a short period.
Hari Kebangsaan: Tidak berkira hias rumah, kereta sejak 24 tahun lepas
Kandapan juga cukup terkenal dengan keretanya yang turut dihiasi Jalur Gemilang, bendera Johor dan semua negeri serta pelbagai pelekat imej bertemakan kemerdekaan termasuk wajah pemimpin negara.
Malaysia kekal destinasi utama bagi pelaburan PTTEP - BMI
Malaysia akan kekal sebagai destinasi utama bagi pelaburan syarikat minyak nasional Thailand, PTT Exploration and Production (PTTEP), dalam jangka masa pendek dan panjang.
Jualan penyaman udara naik mendadak di negara Balkan
Menetap di negara sejuk, mereka tidak pernah terfikir memasang penyaman udara di dalam rumah memandangkan musim panas bukanlah setiap hari. Namun, cuaca panas melampau membuatkan mereka bertukar fikiran.
Malaysia kecam sekeras-kerasnya pencerobohan ekstremis Zionis Israel ke atas Masjid Al-Aqsa
Kerajaan Malaysia mengecam sekeras-kerasnya pencerobohan Masjid Al-Aqsa oleh ekstremis Zionis Israel pada 13 Ogos.
Reda dengan pemergian anak walaupun bukan pengakhiran diharapkan - Ayah Nidza Afham
Ayah kepada penyanyi dan Youtubers Muhammad Nidza Afham Mokhtar reda dengan pemergian anak lelakinya walaupun itu bukan pengakhiran yang beliau harapkan.
Ahli perniagaan diberkas, terlibat dalam aktiviti kumpulan mafia
Seorang ahli perniagaan Itali ditangkap di bandar Natal, Brazil pada selasa.
Giuseppe Bruno kini menghadapi tuduhan termasuk melakukan pemerasan dan pengubahan wang haram dan juga penglibatan bersama kumpulan mafia.
Giuseppe Bruno kini menghadapi tuduhan termasuk melakukan pemerasan dan pengubahan wang haram dan juga penglibatan bersama kumpulan mafia.
Srettha hormati keputusan mahkamah
Srettha Thavisin menghormati keputusan Mahkamah Perlembagaan Thailand yang memecatnya daripada jawatan Perdana Menteri.
Lahir empat hari lepas, bayi kembar maut angkara serangan rejim Zionis
Kembar lelaki diberikan nama Asser manakala Ayssel pula nama diberi buat kembar perempuan, kedua-duanya lahir pada 10 Ogos lepas.
Lelaki tikam ibu saudara direman tujuh hari
Seorang lelaki yang disyaki menikam ibu saudaranya di kepala dengan gunting, semalam direman selama tujuh hari hingga 21 Ogos ini.
PN senarai pendek tiga calon, akan diumum selepas PRK Nenggiri
Perikatan Nasional telah menyenarai pendek tiga calon untuk bertanding pada Pilihan Raya Kecil (PRK) Dewan Undangan Negeri (DUN) Mahkota yang dijadualkan berlangsung pada 28 September depan.
Kumpulan pertama durian segar Malaysia masuk ke China penghujung Ogos
Susulan kelulusan daripada Kerajaan China, penghantaran sulung durian segar Malaysia beserta kulitnya dijangka memasuki pasaran China menjelang akhir bulan ini.
[LAPORAN KHAS] Bulan Kebangsaan MY-SG: Disiplin fiskal persiapan cabaran masa depan
Laporan Khas Bulan Kemerdekaan Malaysia-Singapura bertemakan pembangunan demi kemakmuran bersama, menyingkap amalan fiskal Singapura dalam mempersiapkan rizab kewangan mencukupi untuk masa depan.
ASEAN kekal rakan perdagangan terbesar China
China menjadi rakan perdagangan terbesar ASEAN selama 15 tahun berturut-turut, manakala ASEAN menjadi rakan perdagangan terbesar China selama empat tahun berturut-turut.
Bulan Kebangsaan MY-SG: Mengurus pembangunan tanah secara hemat dan mampan
Laporan Khas Bulan Kemerdekaan Malaysia-Singapura bertemakan pembangunan demi kemakmuran bersama, melaporkan pendekatan Singapura membangunkan sumber tanah dengan hemat.
Hari ASEAN ke-57: PM Anwar seru perpaduan untuk rantau yang aman dan makmur
Perdana Menteri Malaysia Datuk Seri Anwar Ibrahim pada Khamis menekankan kepentingan negara-negara anggota bersatu padu dan bekerjasama untuk memastikan rantau yang aman, stabil dan makmur.
Jualan EV ASEAN melonjak, Malaysia antara peneraju prestasi - Maybank Investment
Peraturan yang positif, jenama tempatan dan penembusan pengeluar kereta China akan memacu jualan yang lebih tinggi.
Bursa Malaysia tingkat sasaran keuntungan 2024 kepada RM361 juta hingga RM379 juta
Bursa Malaysia mengemas kini sasaran keuntungan sebelum cukai (PBT) untuk tahun kewangan 2024 (TK2024) daripada RM293 juta hingga RM323 juta kepada RM361 juta hingga RM379 juta.
Sentimen pulih, ringgit terus meningkat pada sesi awal
Pada 8 pagi, ringgit di paras 4.6330/6400 daripada paras 4.6350/6375 pada akhir urus niaga semalam.
ASEAN sambut baik perubahan sikap negara kuasa besar terhadap isu Palestin
ASEAN mengalu-alukan perubahan sikap dan pendirian beberapa negara kuasa besar dalam isu melibatkan rakyat Palestin yang terus menerus diperlakukan secara kejam oleh rejim Zionis.
Malaysia sudah bersedia menjadi Pengerusi ASEAN 2025
Malaysia sudah bersedia untuk menjadi Pengerusi ASEAN 2025 dan tuan rumah bagi Sidang Kemuncak ASEAN tahun hadapan.