The accelerated spread of COVID-19 has brought the world economy to a standstill. Projections of the potential impacts of the COVID-19 shock on the global economy vary considerably. Yet there is near unanimous consensus that the world economy is facing the most serious challenge of the post-war era due to the sudden halt in economic activity in both advanced and developing countries.
Containment measures are leading to further downward predictions of global GDP growth
In mid-April, the International Monetary Fund (IMF) updated its global growth projections and stressed that the global economy is expected to experience its worst recession since the Great Depression. The WTO’s latest forecasts are even worse, projecting a negative growth rate of nearly 9 per cent for 2020 in the worst-case scenario (Figure 2). Other projections conducted at the beginning of the month were more optimistic, such as that of the United Nations Department of Economic and Social Affairs (UNDESA): in the worst-case scenario, global GDP will contract by up to 1 per cent.