WAHINGTON (Sputnik) – A potential new wave of the novel coronavirus outbreak in 2021 could reduce global economic growth to nought, International Monetary Fund (IMF) Chief Economist Gita Gopinath said on Wednesday following the release of the updated World Economic Outlook.

“When we have looked at the impact of a second wave that hits in, say, early 2021- in that case, instead of growth of 5.4 percent it would be zero percent”, Gopinath said.

The IMF chief economist warned that such a development would be a dramatic hit for the global economy.

Gopinath said the novel coronavirus crisis is not over and the world could potentially face an increase in the number of infections.

However, she did not forecast imposing lockdowns as was done in the first half of 2020 and brought the world economy to a halt.

IMF forecasts in its updated World Economic Outlook that economic growth will increase to 5.4 percent.

New COVID-19 Wave May Significantly Disrupt Domestic Economic Activity in 2021

“While the baseline does not rule out a possible resurgence in cases in some countries, the first scenario assumes instead that a second major global outbreak takes place early in 2021″, the IMF said in its updated World Economic Outlook (WEO).

In such a scenario, the fund does not rule out the possibility of additional tightening in financial conditions in 2021.

Faster recovery will soften financial conditions next year, the report added.

The IMF stressed the unprecedented character of the current situation.

The fund has forecasted significant downside risks, specifically, in case of recurring waves of the pandemic.

The IMF slashed its 2020 global growth forecast by 1.9 percent to -4.9 percent.

According to the global health body, the coronavirus death toll worldwide has surpassed 469,000 people, with the number of cases nearly reaching 9 million.

Sourse: sputniknews.com

IMF Says 2021 Growth Could Be 0% if Second Coronavirus Wave Hits Early On

0.00 (0%) 0 votes

LEAVE A REPLY

Please enter your comment!
Please enter your name here