Who wins the race? The battle between scientific innovations & nature ignited debate many times, but with a tattering vague conclusion. Manifestation with nature proved fatal. No matter who the culprit is? The corona outbreak is a big lesson for homo sapiens.
A plummet in the world’s economy in the name of the COVID-19 pandemic, took the world by storms, which no one expected. A deadly virus said to be originated in the city Wuhan (China) consumed from BATS, and genetically extracted in laboratories. It proved to be the worst health crisis- the world has ever witnessed.
Taking thousands of lives and demonstrating a threat to the so-called economy. Till date, more than 2,653,422 and 185, 059 deaths registered world across. Business slumped unexpectedly leading to the downfall. It pushed the investors in a situation where companies are counting on investments than ROI.
As Novel CORONA at peak. The world’s powerful democracy the US is not even spared. As this deadly virus doesn’t discriminate between race, religion or ethnicity. The 32.82 crores populous nation is experiencing a severe health crisis with 8,49,092 confirmed cases and 47,681 registered deaths. Its- hue and cry were such that US President Donald Trump, having to beg HCQ ( Hydroxychloroquine) an anti-Malaria drug. But this is not even WHO endorsed. No vaccines or medications have yet been discovered.
Even WHO, has no clue and is expecting a miracle. Nevertheless, virologists are researching day-in and out with no trace of success yet. As per the analysis of the UN Department of Economic & Social Affairs, this is disrupting the supply chain and international trade. With more than 100 countries closed during the last 30 days; brought to a screeching halt.
A country like Italy, known for its top-notch healthcare, failed to tackle Hence, putting the economic growth to a screeching halt. That took the world by storms. The novel COVID-19 is peaking at an uncontrollable rate. Fatalities are rising by big numbers like the stock market, but only in ascending order.
After creating panic in countries like China, Italy, France and the US; this deadly virus is at peak -and spreading wings in India, Nepal & Pakistan. It has kicked the economy into a dumping zone, which is hard to relax shortly. As more than 10 million jobs are in threat 5 million people already lost their jobs. Millions of people across the globe are not only bearing the pandemic brunt but also losing jobs. During the lockdown phase, the economy is reeling under pressure.
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In India, the Government is playing its role by providing financial assistance through various welfare programmes. Essentials like staples are being distributed on a broader scale. Well, we are talking about the organised sector. What about the INFORMAL SECTOR? Vendors, hawkers, squatters, rickshaw pullers have gone jobless in no time. For them, this is a double-edged sword than to die either of starvation or CORONA pandemic.
It saw a sharp decline that could potentially plunge the world economy into one of the worst economic crisis. The world’s economy may fall by a big margin by 0.9 per cent in 2020,” the DESA said, as the economy has squeezed by 1.7 percent during the global financial crisis in 2009. In the backdrop of this fate, the economy appears to be in dire strait. Millions of businesses slumped in quick time and reminded the 2008 Lehman Brothers downfall. But this is worse than that.
Not only pulling the economy down but also taking precious lives. A phase where immunity of the economy goes hand- in-the hand with the immunity of the body. The decline in GDP equates to a USD 2.8 trillion leading to falling in global income levels in comparison to 2019 and a loss of USD4.5 trillion relative to our pre-virus expectations of 2020 global GDP. Fitch expects the GDP in the eurozone is supposed to decline by 7%, US GDP by 5.6%, and UK GDP by 6.3% in 2020.
Eurozone is most affected to halt the spread of COVID-19 and has taken a heavy toll on activity in Q20. Italy’s 2020 GDP forecast to 8 % following an indication that GDP already fell 5 % in Q20 post a recent extension of the lockdown. France and Spain experience a 5% decline in GDP in Q 20 and Spain attracts a decline in Spanish tourism.
The biggest downward revisions are in the eurozone, where the measures to curb coronavirus have taken a heavy toll in 1 Q20. In Italy 2020 GDP forecast to -8% following official indications that GDP already fell 5% in 1 Q20 post a recent extension of the lockdown Official estimates point to France and Spain experiencing near 5% declines in GDP in 1Q20, with the Spanish outlook hit particularly hard by the collapse in tourism. Even portraying a slightly less negative outlook for Germany – where the headroom for policy easing is greater. The benefits of recovery in China will be felt more directly – eurozone GDP is all set to shrink by 7% this year.
Also, LOCKDOWN in France is still reducing economic activity by 35 % since it was imposed despite reopening. And industries appear to be opening up. This activity has yet to reopen since the lockdown is containing the Corona. No country or region is spared from the devastating economic impact of a global pandemic.
We now anticipate that GDP in both the US and the UK – where the impact of the pandemic realized later in the eurozone – and declined by more than 10% (not annualised) in 2Q20, compared to forecasts of around 7% in our early April update. As it will result in annual GDP decline of around 6%, despite aggressive macro policy easing.
The least can we do is to break the lockdown phase and wait until this Novel virus becomes Noble. That’s the only way we could foresee the economy back on track.