Based on the last World Economic Outlook, April 2020 released by the International Monetary Fund (IMF), the COVID-19 is inflicting high and rising human costs worldwide and as a result, the global economy is projected to contract sharply by -3% in 2020, much worse than during the 2008-2009 financial crisis. Of course, there is extreme uncertainty around the global growth forecast because the economic fallout depends on uncertain forecast but the disruptions are assumed to be concentrated mostly in the second quarter of 2020 for almost all countries, except China (where it is in the first quarter).
Growth in the Euro-area, where several economies are experiencing widespread outbreaks and deploying containment measures, is projected at -7,5% in 2020. In parts of Europe, the outbreak has been as severe as in China’s Hubei province even though lockdown and restriction on mobility are imposing very high prices on economic activity overall. In a baseline scenario and despite the insecurity vague, global growth is expected to rebound to 5,8% in 2021, (in comparison, in 2010 global growth rebounded to 5,4% from -0,1% in 2009). While the Euro-area to 4,7%, based on the data Report. The rebound will depend critically on the pandemic fading in the second half of 2020. With the world facing a dramatic health and economic crisis in 2020, the policy response is essential and need to be commensurate with the challenge to forestall worse outcomes. Internationally, a strong multilateral cooperation is essential to overcome the effects of this unprecedented global pandemic.
IMF source World Economic Outlook, April 2020