The Argentine economy will have a average GDP drop of 5,7% in 2020, similar to the average forecast for South American countries, which together will fall 5% for the same period, as a result of the global economic impact of the coronavirus pandemic, the International Monetary Fund (IMF) estimated on Tuesday (14.04.2020/XNUMX/XNUMX).
The Fund today revealed its projections of the world economythrough the presentation of its traditional semi-annual World Economic Outlook report, called «The Great Isolation» (this year the original title is The Great Lockdown, which refers to isolation and the halt of the world economy).
This is on the occasion of the classic Spring meeting that it is organizing together with the World Bank, which for the first time will be entirely virtual, due to the circumstances imposed by the pandemic.
In the report, the IMF states that The region's largest economy, Brazil, will fall by 5,3%While Chile will do so by 4,5% like Peru.
While Uruguay will fall 3%, while the remaining Mercosur partner, Paraguay would barely drop 1%, being one of the least affected in the region.
The report, presented by the agency's chief economist, Gina Gopinath, warned that due to the circumstances in which a turnaround of the world economy towards a recession of around 3% is expected, the organization's full report will not be known until May, since the current one contains a shorter than usual extension and a lot of data that has not been analyzed.
For example, the annual projections (December versus December) of the countries in the region are not published, which is the statistic with which the annual data of the Fund are compared with those of Indec, regarding estimates of GDP and prices, among others.
Argentina
In particular for Argentina, it is expected that the estimate of a GDP drop of 5,7% This refers to the average for the year, and the same is true for 2021, when the local economy is expected to recover by 4,4%.
Regarding the level of unemployment, the Fund predicts that Argentina will rise by 1,1 percentage points and would be located at 10,9%, when in Brazil the unemployment rate will rise to almost 15%.
The impact of Covid-19 is so great that just four months ago, last January, when the WEO was updated, the IMF believed that the world economy was going to grow by 3,3%, when now it estimates that the global economy will plummet by 3%.
«The global economy is very likely to experience its worst recession since the Great Depression this year, surpassing that seen in the financial crisis a decade ago; The Great Lockdown, as it might be called, is projected to reduce global growth dramatically.», Gopinath warned.
He continued that, for 2021, the recovery will remain "below the pre-virus trend, with considerable uncertainty about the strength of the rebound."
Gopinath requested «international cooperation» on at least two issues: on the one hand, in addition to sharing equines and experience, he called for "a global effort to ensure that when therapies and vaccines for Covid-19 are developed, both rich and poor nations have immediate access."
He also said that "the international community will also need to intensify its efforts financial assistance For many emerging markets and developing economies, and for those facing large debt repayments, a debt moratorium or restructuring may be necessary,” he said, noting that “this crisis is like no other.”
For their part, the world's largest economies, such as the Eurozone and the United States, will suffer a sharp decline as a result of isolation, of 7,5% and 5,9%, respectively, something unthinkable just three months ago.
Among the list of countries hardest hit on the planet are Greece (-10%), Italy (-9,1%) and Spain (8%), among others.
China and India, on the other hand, are among the few countries in the world that will grow in 2020, with GDP growth expected to reach 1,2% and 1,9%, respectively.
The latest #WEO projects a sharp contraction for the global economy to -3% in 2020 and a partial rebound to 5.8% in 2021 provided economic activity normalizes. However, uncertainty is exceptionally high. See projections by region. #IMFBlog https://t.co/93xXDRsg3B pic.twitter.com/7Zag8ktkfv
— IMF (@IMFNews) April 14, 2020
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