We have entered a recession which will be worse than 2009: IMF chief Kristalina Georgieva

The Coronavirus (COVID-19) pandemic has driven the worldwide economy into a downturn which will require massive funding to assist developing nations, IMF chief Kristalina Georgieva said on Friday, March 27, 2020.

 

In a web press briefing, the IMF Chief said, “We have reassessed the expansion prospects for 2020 and 2021 and it’s clear that we’ve entered a recession” which will be as bad or worse than the one that we witnessed in 2009, following the worldwide financial crisis.

 

Georgieva said, “We project a rebound in 2021 – actually , there could also be a sizeable rebound, but as long as we succeed with containing the virus everywhere and stop liquidity problems from becoming a solvency issue.” She added a key concern a few long-lasting impact of the sudden stop of the planet economy is that the risk of a wave of bankruptcies and layoffs that not only can undermine the recovery but can erode the material of our societies.

 

To avoid this from happening many countries have taken far-reaching measures to deal with the health crisis and to cushion its impact on the economy both on the monetary and on the fiscal side. The G20 reported fiscal measures totalling some $5 trillion or over 6% of the worldwide GDP. So, it’s vital for those ahead in taking action to share their experience with those still behind.

 

To support this, the IMF has launched a policy actions tracker for 186 countries to assist us all see who is doing what. we’ll be updating this information regularly and can provide country-specific analysis in line with our surveillance mandate. She added, over 80 countries mostly of low incomes have already requested emergency aid from the International fund .

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