COVID-19: UN Foresees Global Economy To Contract 0.9% In 2020

FILE PHOTO: Secretary General of the United Nations Antonio Guterres addresses the United Nations Security Council on "mediation and its role in conflict", during an open debate on maintenance of international peace and security at the United Nations Headquarters in New York City, New York, U.S., August 29, 2018. REUTERS/Andrew Kelly

The world economy could contract by 0.9 per cent this year due to the impact of the coronavirus pandemic, the UN said on Wednesday.

This worst-case scenario assumes that wide-ranging restrictions on the movement of people and economic activities in major economies last until mid-May, according to the UN’s monthly economic briefing.

Global growth could plunge even further if those restrictions extend beyond May.

Before the coronavirus outbreak, the UN expected world output to expand at a pace of 2.5 per cent in 2020.

“Urgent and bold policy measures are needed, not only to contain the pandemic and save lives, but also to protect the most vulnerable in our societies from economic ruin.

“And also to sustain economic growth and financial stability,” Liu Zhenmin, Under-Secretary-General for Economic and Social Affairs at the UN, said in the briefing note.

A stimulus package that prioritises health spending to stem the spread of the virus and provides income support to those most affected by the outbreak could help minimise the likelihood of a deep economic recession, according to the UN.

The world economy contracted by1.7 per cent during the global financial crisis in 2009. (dpa/NAN)