Virus fallout: Economists forecast global recovery in 6-9 months
dubai — The global economy, which is in the grip of a recession as the coronavirus pandemic ravages mankind with unbridled ferocity, stands a chance to get into recovery mode in six to nine months if mass testing is rolled out urgently and governments across the world guarantee to support demand and provide financial stimulus, economists said.
Nigel Green, CEO and founder of deVere Group, is one among a few economists who share this optimism.
His forecast of a conditional recovery comes as global stocks held steady on Tuesday, after rallying on tentative indicators the Chinese economy — the world’s second-largest — is stabilising following coronavirus lockdowns being lifted.
However, they retreated on Wednesday as the pandemic worsens in the US, the world’s largest economy.
Green’s upbeat prediction comes in the wake of the United Nation’s latest trade report on Tuesday, forecasting that the world economy will go into recession this year with a predicted loss of global income in trillions of dollars. The International Monetary Fund and other global institutions had also foreseen the bleak state of the world economy as the world went into a standstill under the assault of the pandemic.
Economist Nouriel Roubini, warning that failure to rein in the pandemic risks a worse downturn than the Great Depression, said the best-case scenario is a return to growth in the fourth quarter of this year. “The hardest-hit countries must conduct mass virus — testing, enforce quarantines, lockdowns, and roll out antivirals and other therapies on a massive scale. Central banks must continue to throw the kitchen sink of unconventional measures at the crisis and governments must engage in massive fiscal stimulus,” he said.
“No one knows for sure the full of extent of the impact of the public health emergency on the world economy – but a significant downturn is, unfortunately, almost inevitable,” said Green.