The IMF described the global decline as the worst since the Great Depression of the 1930s.

It said the pandemic had plunged the world into a “crisis like no other”.

The Fund added that a prolonged outbreak would test the ability of governments and central banks to control the crisis.

Gita Gopinath, the IMF’s chief economist, said the crisis could knock $9 trillion (£7.2 trillion) off global GDP over the next two years.

‘Great Lockdown’
While the Fund’s latest World Economic Outlook praised the “swift and sizeable” response in countries like the UK, Germany, Japan and the US, it said no country would escape the downturn.

It expects global growth to rebound to 5.8% next year if the pandemic fades in the second half of 2020.

Ms Gopinath said today’s “Great Lockdown” presented a “grim reality” for policymakers, who faced “severe uncertainty about the duration and intensity of the shock”.

“A partial recovery is projected for 2021,” said Ms Gopinath. “But the level of GDP will remain below the pre-virus trend, with considerable uncertainty about the strength of the rebound.

“Much worse growth outcomes are possible and maybe even likely.”


Sharpest UK downturn in a century
The IMF predicts the UK economy will shrink by 6.5% in 2020, compared with the IMF’s January forecast for 1.4% GDP growth.

A decline of this magnitude would be bigger than the 4.2% drop in output seen in the wake of the financial crisis.

It would also represent the biggest annual fall since 1921, according to reconstructed Bank of England data dating back to the 18th century.

However, this is half the annual rate expected by the OBR, which expects GDP to drop by 35% in the three months to June.

The UK’s furlough scheme, which is designed to keep workers in a job amid the government lockdown, is expected to limit the rise in unemployment to 4.8% in 2020, from 3.8% last year.

UK Chancellor Rishi Sunak has pledged billions of pounds in wage subsidies and loan guarantees to help workers and businesses through the shutdown.

The Bank of England has also slashed interest rates to a new low and freed up billions of pounds for commercial banks to lend.
READ MORE; https://busynaija.com.ng/2020/04/14/coronavirus-world-faces-worst-recession-since-great-depression/