Photo: Michael Dantas Agence France-Presse
Become a hotbed of contamination, Brazil, are particularly affected, might witness the disappearance of 8% of its economy.
It has already been predicted that the pandemic coronavirus was going to plunge the world economy into its sharpest recession since the Second world War. But it will be even worse than previously thought, estimates the world Bank.
Contrary to that announced by the international monetary Fund (IMF) in its most recent forecast in mid-April, the global economy will not switch to a growth of 2.9% last year, a decline of 3 % this year, making the “Great Confinement” the worst economic crisis of the post-war period, has warned, on Monday, the other Bretton Woods institution. No, the downfall of economic benefits will be even more sharply, to 5.2 %. And if one is still miles away from the ravages of the Great Depression of the 1930s, we would still never seen such a proportion of the whole economies of the planet (90 %) registering a decline of their per capita wealth at the same time.
“The crisis due to the pandemic COVID-19 is outstanding in many respects, said in a statement the director of the team responsible for the analysis of the economic outlook at the world Bank, Ayhan Kose. It promises to be the most severe recession in the advanced economies since the Second world War, while the emerging and developing economies should be aware of the first contraction of their production in sixty years. “
On the side of advanced economies, this is expected now with a contraction of 7 % this year, in particular due to a decline of 6.1 % in the United States and Japan, and 9.1 % in the euro zone, predicted the institution, who does not stop to other developed economies, in particular, because she is particularly interested in the emerging and developing countries.
In the latter, she predicted, 2.5 %, an economic downturn two times more severe than projected in April, the IMF (-1 %). The hardest-hit countries, says the world Bank, are those where the epidemic has been most severe and those that are most dependent on global trade, tourism, commodity exports and external financing. Become a hotbed of contamination, Brazil could see it disappear, and 8 % of its economy. Mexico (7.5 %) and Russia (-6 %) accuse hard shot as well. China’s economic growth, it could melt from 6.1 % last year, to just 1% this year, is ” by far its weakest expansion recorded in more than 40 years “. In sub-saharan Africa will suffer from its side, “a recession is unprecedented,” with an economic contraction of 2.8 %.
More extremely poor
“These prospects are all the more alarming that the crisis could leave long-lasting consequences and give rise to difficulties global major,” said Ceyla Pazarbasioglu, vice-president of the division equitable growth, finance, and institutions of the world Bank. One of these consequences, she explained, will be likely to switch from 70 to 100 million more people into extreme poverty, the Bank at a fixed income of less than US $1.90 per day.
If we can sufficiently control the progress of the pandemic so that the rich countries are able to undertake their déconfinement in the next few days, followed a little later by the developing economies, we can expect a modest rebound in global growth, respectively 3.9 % and 4.6 % in 2021.
The difficult art of prediction
Experts have an unfortunate tendency, during recessions and to underestimate the extent of the fall that awaits the economies, reminds the world Bank. Sign of the extreme degree of uncertainty these days, an analysis of their work since 1990 also shows that their forecasts have never been so far away from each other these days.
It would be enough, ” says the world Bank, that the pandemic is longer than anticipated, as the financial markets begin to seize, or that we are witnessing a new escalation of trade tensions to a scenario that is more pessimistic, is carried out. Thus, the fall in global growth, could quickly not be 5.2 per cent, but 8 per cent this year, and the recovery, the next year, be limited to a paltry 1% instead of the 4.2 percent expected.
It is therefore important to win the battle against the COVID-19, says the world Bank, but also the care of those who are at risk of suffering the health impacts and economic, including the workers of the informal sectors in developing countries who often have no access to care, public health or a social safety net.
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