IMF Managing Director Kristalina Georgieva painted a far bleaker picture of the social and economic impact of the new coronavirus than even a few weeks ago, noting governments had already undertaken fiscal stimulus measures of $8 trillion, but more would likely be needed. The pandemic sweeping the world will turn global economic growth “sharply negative” in 2020, triggering the worst fallout since the 1930s Great Depression, with only a partial recovery seen in 2021, the head of the International Monetary Fund said.
She said the crisis would hit emerging markets and developing countries hardest of all, which would then need hundreds of billions of dollars in foreign aid. If the pandemic faded in the second half of the year, the IMF expected a partial recovery in 2021, Georgieva said, but she warned the situation could also get worse. “I stress there is tremendous uncertainty about the outlook : it could get worse depending on many variable factors, including the duration of the pandemic,” she said.
With commodity prices down sharply, emerging market and developing countries would need trillions of dollars to fight the pandemic and rescue their economies, she said.
Georgieva said it was encouraging that all governments had sprung into action, enacting some $8 trillion in fiscal measures and massive monetary measures. To ensure a future recovery, Georgieva called for continued efforts to contain the virus and support health systems, while averting export controls that could slow the flow of vital medical equipment and food