International Monetary Fund (IMF) said that the world had entered a recession due to the coronavirus pandemic.But the IMF projects a recovery next year.
IMF Managing Director Kristalina Georgieva said that they have reassessed the prospects for growth for 2020 and 2021. It was clear that the world had entered a recession as bad or worse than in 2009. Also, they projected recovery in 2021.
Recovery from COVID-19 in 2021
IMF managing director emerged from the meeting of the governing body of IMF and Financial Committee that represent 189 members. The meeting was to discuss the unprecedented challenge posed by COVID-19.
She said that the key to recovery was only if the international community succeeded in containing the virus and prevent liquidity problems. The US was in recession, as was the rest of the advanced economies of the world. Also, the developing economies were in recession. They were working on their projections for 2020 said Georgieva in the answer to a question.
Georgieva stressed the need for virus containment for the economy to stand still. She said that containment was very necessary to come out of this phase. Also, she highlighted the key concern of the long-lasting impact of the sudden stop of the world economy.
She said that there was a risk of bankruptcies and layoffs that not only could undermine the recovery but also could erode the fabric of the society. She further said that many countries had started taking measures like addressing their healthcare and cushion their economies to mitigate the effect of recession.