China News Client, Beijing, April 14 (Reporter Li Jinlei) On the 14th, the International Monetary Fund (IMF) released the latest issue of the World Economic Outlook, which is expected to shrink sharply by 3% in 2020, the most serious since the Great Depression Economic recession. The US economy is also expected to shrink by 5.9%.

The worst economic recession since the Great Depression

The IMF said the epidemic is causing high and increasing costs worldwide. In order to protect lives and enable the medical system to respond to this outbreak, isolation, blockade, and extensive closures are needed to slow the spread of the virus. Therefore, the health crisis is having a serious impact on economic activity.

"Due to the epidemic, the global economy is expected to contract sharply by 3% in 2020." The IMF predicts. Compared with the forecast of 3.3% in January 2020, the current forecast has been lowered by 6.3 percentage points, which is a substantial correction in a short period of time.

IMF chief economist Gita Gopinat said that this made the "big blockade" the worst economic recession since the "Great Depression" in the 1930s, much worse than the situation during the 2008-2009 global financial crisis .

From the International Monetary Fund.

Per capita income in more than 170 countries is expected to shrink

"This is a real global crisis, because no country is immune." Gita Gopinat said that countries whose economic growth depends on industries such as tourism, travel, hotels and entertainment are experiencing particularly severe disruptions to their economies.

In addition, emerging markets and developing economies face additional challenges and currency pressures from unprecedented reversal of capital flows due to weakened global risk appetite, and at the same time, their health systems are relatively weak and the fiscal space for support is more limited.

Gita Gopinat said that the cumulative loss of global GDP in 2020 and 2021 caused by the epidemic crisis may reach about 9 trillion US dollars, which is greater than the sum of the economies of Japan and Germany. Per capita income in more than 170 countries is expected to shrink.

US GDP is expected to shrink by 5.9% this year

The IMF predicts that this year the economy of advanced economies will shrink by 6.1%, and that of emerging markets and developing economies will shrink by 1%.

Among them, the US economy is expected to contract by 5.9% this year, the euro zone economy will contract by 7.5%, and the Japanese economy will contract by 5.2%.

Gita Gopinat said that advanced economies, as well as emerging markets and developing economies, are in recession at the same time. This is the first time since the “Great Depression”.

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The global economy is expected to rebound to 5.8% next year

The IMF said that assuming the epidemic subsides in the second half of 2020, policy actions taken by various countries can effectively prevent large-scale bankruptcy, long-term unemployment, and systemic financial pressure. It is expected that global growth will rebound to 5.8% in 2021.

Among them, advanced economies and emerging markets and developing economies are expected to recover to some extent in 2021.

Specifically, the US economy is expected to grow by 4.7% in 2021, and the Chinese economy will grow by 9.2%.

Countries urgently need to work together

Gita Gopinat reminded that if the epidemic continues longer this year, the global GDP in 2020 may be further reduced by 3% from the baseline forecast; if the epidemic continues into 2021, the growth next year may be further reduced by 8% from the baseline forecast.

The IMF recommends that policymakers need to adopt large-scale, targeted fiscal, monetary, and financial market measures to support affected households and businesses. Moreover, strong multilateral cooperation is essential to overcome the impact of the epidemic.

Gita Gopinat said that countries urgently need to work together to slow the spread of the virus and develop vaccines and therapies to combat the disease. Before these medical interventions were in place, as long as the virus spread elsewhere, no country would be immune to the outbreak (including the resurgence of the virus after the first wave of outbreaks subsided). (Finish)