COVID-19: IMF predicts global economy would shrink by 3% in 2020

COVID-19: IMF predicts global economy would shrink by 3% in 2020

- The IMF has projected a possible 3% shrink in the global economy as the coronavirus continues to spread globally

- It has also raised cautioned there are extreme uncertainties tied to its 5.8% growth projection in the world's economy

- It also indicated that there is a possible cumulative loss of $9 trillion loss in output over two years, which is greater than the combined GDP of Germany and Japan

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The International Monetary Fund (IMF) has predicted a likely shrink in the global economy by 3%.

According to the IMF, the collapse of economic activities would mark the steepest downturn since the Great Depression of the 1930s.

In its 2020 World Economic Outlook, the IMF predicted a partial rebound in 2021 with the world economy growing at 5.8%.

READ ALSO: 25 poor countries enjoy 6 months extensions on debt payments by the IMF

Per a Reuters report, it, however, stated that there are extreme uncertainties tied to the forecasts.

This, it went on, could lead to far worse outcomes depending on the course of the outbreak.

The IMF has projected that there is likely to be a cumulative $9 trillion loss in output over two years, which is greater than the combined Gross Domestic Product (GDP) of Germany and Japan.

It further predicted that the coronavirus could reach its peak in several countries during the second quarter of 2020 and fall in the second half of the year.

Meanwhile, the IMF has given its approval for a $1 billion credit facility to Ghana to combat the coronavirus pandemic that has ravaged the economy and inflicted hardship on Ghanaians.

The IMF, on Monday, April 13, 2020, approved the fund, which would be drawn under the Rapid Credit Facility.

The outbreak of the coronavirus has negatively impacted Ghana’s economy and has led to a slowdown of growth, the tightening of financial conditions and placed pressure on the exchange rate.

READ ALSO: New World Bank report shows sub-Saharan Africa may record first recession in 25 years

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Source: Yen

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