The coronavirus pandemic will turn global economic growth “sharply negative” this year, the head of the International Monetary Fund (IMF) has warned. Kristalina Georgieva said the world faced the worst economic crisis since the Great Depression of the 1930s. BBC reports:
She forecast that 2021 would only see a partial recovery. Ms Georgieva, the IMF’s managing director, made her bleak assessment in remarks ahead of next week’s IMF and World Bank Spring Meetings. Emerging markets and developing countries would be the hardest hit, she said, requiring hundreds of billions of dollars in foreign aid. “Just three months ago, we expected positive per capita income growth in over 160 of our member countries in 2020,” she said. “Today, that number has been turned on its head: we now project that over 170 countries will experience negative per capita income growth this year.” She added: “In fact, we anticipate the worst economic fallout since the Great Depression.”
Ms Georgieva said that if the pandemic eased in the second half of 2020, the IMF expected to see a partial recovery next year. But she cautioned that the situation could also worsen. “I stress there is tremendous uncertainty about the outlook. It could get worse depending on many variable factors, including the duration of the pandemic,” she said.
Her comments came as the US reported that the number of Americans seeking unemployment benefits had surged for the third week by 6.6 million, bringing the total over that period to more than 16 million Americans.