The International Monetary Fund (IMF) on Thursday predicted the worst economic downturn globally since the Great Depression, projecting negative growth for 170 countries in the world as the COVID-19 pandemic continues to eat deep into the wealth of nations.
The Managing Director of the IMF. Kristalina Georgieva said this in a speech titled “Confronting the Crisis: Priorities for the Global Economy,” ahead of the 2020 Virtual Spring Meetings of the IMF/World Bank.
She said the fund with a lending capacity of $1 trillion has received the approval of its board to double access to its emergency facilities, which will allow it to meet the expected demand of about $100 billion in financing.
While noting that although the fund had earlier in the year projected positive per capita income growth in over 160 of its member countries in 2020, she said, “we are still faced with extraordinary uncertainty about the depth and duration of this crisis.”
She added: “We are still faced with extraordinary uncertainty about the depth and duration of this crisis. It is already clear, however, that global growth will turn sharply negative in 2020.
“In fact, we anticipate the worst economic fallout since the Great Depression.
“Just three months ago, we expected positive per capita income growth in over 160 of our member countries in 2020. 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, however, said a partial recovery was plausible if the pandemic was curtailed timely.
She added: “If the pandemic fades in the second half of the year thus allowing a gradual lifting of containment measures and reopening of the economy our baseline assumption is for a partial recovery in 2021.