The world economy is expected to shrink by 3 percent this year, with countries around the world shrinking at the fastest pace in decades, according to the International Monetary Fund.
The fund warned that this situation could become the worst since the “Great Depression” of the 1930s.
He said that the Corona epidemic had brought the world into a “crisis like no other”.
He added that the continued spread of the epidemic will test the ability of governments and central banks to control the crisis.
The fund’s chief economist, Gita Gopinath, said the crisis had shrunk global gross domestic product by about $ 9 trillion over the next two years.
Another IMF report on the outlook for the global economy praised the “rapid and appropriate” response in countries such as Britain, Germany, Japan and the United States, saying that no country is free from economic downturn.
The fund expects growth to recover by 5.8 percent next year, if the epidemic fades in the second half of 2020.
Gopinath said that the “great closure” in the countries of the world provides a “dark reality” for the decision-makers, who face political “confusion over the duration and severity of the shock.”
“A recovery is expected in 2021. But the level of GDP will remain below its rate before the virus occurs, with considerable confusion over the strength of recovery,” she added.
But she expected a decline in growth.
The International Monetary Fund expected the British economy to shrink by 6.5 in 2020, compared to its January forecasts of 1.4 percent growth.
Such a contraction will be greater than the 4.2% decrease in output that occurred after the economic crisis.
This is also the biggest annual decline since 1921, according to the Bank of England data.
But this represents half of the expected annual rate, in which GDP is expected to decrease by 35 percent in the three months to June.
The government plan, which aims to keep employees in their jobs during the closure period, is expected to limit the unemployment rate to 4.8 percent in 2020, from 3.8 last year.
British Chancellor of the Exchequer, Rishi Sonak, has pledged billions of pounds to support wages and guarantee loans, to help workers and companies survive during the shutdown.
The Bank of England has also cut interest rates to a lower level and released commercial banks to lend, after saving them billions of pounds.
The chief economist at the International Monetary Fund said that she expects the developed and developing economies to enter a period of recession, not seen in the world since the Great Depression.
The fund warned that economic growth in advanced economies will not return to its previous state until 2022.
The economy in the United States is expected to contract by 5.9 percent, and this is the largest annual decline since 1946. The unemployment rate in the United States is expected to increase to 10.4 percent this year.
But the country is likely to see a recovery in 2021, with 4.7 percent growth.
As for the Chinese economy, it is expected to grow by 1.2 percent this year, which is the lowest rate since 1976. Australia is expected to suffer from its first recession since 1991.
The International Monetary Fund warned of worse results that will be accompanied by “severe risks”.
He said that the epidemic took longer to control it, and there will be a second wave in 2021, and this will reduce GDP by an additional 8 percent.
He added that this scenario might lead economies with big debts to enter a downward spiral of decline.
The fund said investors may not want to lend to such countries, and this will increase borrowing costs.
The fund set four priorities to deal with the epidemic, as it called for more spending on health care systems, financial support for workers and companies, and to continue to support central banks, and then to develop an exit plan from the crisis aimed at economic recovery.