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Global Economy to contract by 5.2% in 2020: Report

The global economy is likely to contract by 5.2% in 2020 with the coronavirus still spreading and the economic prospects of countries across the world looking muted, PTI reports quoting a Dun and Bradstreet’s Country Risk and Global Outlook Report.

According to Dun and Bradstreet’s Country Risk and Global Outlook Report, that covered 132 countries, the wider global context remains sombre and the global economy will not reach pre-pandemic levels of activity again before 2022. “D&B is currently forecasting that the global economy will contract by 5.2% in 2020 – the biggest decline since the Second World War and a far stronger contraction than the 1.7% recorded in 2009 during the global financial crisis,” the report said. The Asia Pacific region is unlikely to shake off the economic effects before the end of 2020, it added.

“Widespread quantitative easing means that financial asset prices globally are not reflecting the shock to fundamentals. But with many countries easing their lockdowns, a more varied picture of upgrades and downgrades has emerged,” Dun & Bradstreet chief economist Arun Singh said. Singh further noted that “worryingly, a sharp recession is still forecast, and we expect that the world economy will not attain pre-pandemic levels of activity before 2022.”

The report said any recovery into 2021 (even without a second bout of the pandemic) is going to be curtailed by several factors. Foremost will be the presence of degrees of social distancing (despite the easing of lockdowns) and higher levels of post-lockdown unemployment and poverty.

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