The COVID-19 pandemic and the following worldwide shutdown have left an imprint on the global economy. Experts at the World Bank suppose that restrictive measures plunged the global economy into lingering recession.

The World Bank reckons that the global GDP will tumble 5.2% in 2020. Most countries are set to show lackluster performance with the sharpest contraction rates since World War II.

Interestingly, the US-based lending institution downgraded its forecast of the global GDP by 7.7% in June despite ebbing infection rates. Experts predict advanced economies to shrink 7% due to apocalyptic changes in domestic supply and demand, international trade, and finance. When it comes to emerging markets, the overall domestic product is expected to drop by 2.5% which is the steepest downturn over the recent 60 years.           

The World Bank warns that the countries where the COVID-19 fallout has been the worst are facing the toughest challenge of reviving their national economies. Experts point out that the pandemic has badly hurt the countries heavily reliant on global trade, tourism, commodity exports, and external finances. Besides, disruptions in schooling and basic healthcare in emerging market countries will entail long-term repercussions.

Another cause for concern for the World Bank is a sharp fall in per capita income which could be 3.6%. If this scenario comes true, millions of people will find themselves on the verge of poverty.          

Pundits are certain that the global community should give priority to supporting the healthcare system, reviving the global economy, reducing large-scale poverty, and bolstering employment.  These immediate major goals require joint efforts.    

According to the baseline scenario from the World Bank, the global GDP could expand 4.2% in 2021 provided that the global economy overcomes rapidly the COVID-19 aftermath. In this case, the GDP of advanced countries could grow 3.9% whereas the GDP of emerging markets could climb as high as 4.6%. However, in the worst-case scenario, the global economy is expected to fall 8% this year and rebound marginally 1% in 2021.      

In a separate survey, the World Bank fears that the US economy could contract 6.1% in 2020 as a result of lockdown measures aimed to contain the coronavirus spread. For the same reason, experts project the eurozone’s GDP to plummet 9.1% this year.

Specialists say that the ongoing crisis forces them to make drastic downward revisions in their outlook for the global economy. To make things worse, the World Bank does not rule out even more dismal forecasts. Analysts advise global central banks to be ready to introduce extra stimulus packages.