The IMF’s April outlook showed that the current recession is the biggest downturn in the global economy in the last 90 years. According to the IMF, global gross domestic product will fall by three percent this year. This will erase all growth from last year, when it grew by 2.9.
IMF chief economist Gita Gopinath said the coronavirus crisis would deprive $ 9 trillion of global GDP, or $ 220 trillion. This corresponds to 168 annual budgets of the Czech Republic. In 2021, however, the IMF and other economists expect an economic recovery.
However, according to the EIU, there is a need to worry about another crisis that may follow immediately after the current one.
Debts, debts, debts …
World governments are putting trillions of dollars on the stimulus package to recover economies, BBC news server reminded. It is the indebtedness of states, which is deepening, according to the EIU could cause a second recession.
“Many European countries that are among the most affected by the pandemic, such as Italy or Spain, had a bad budget before the epidemic,” Agathe Demarais, head of the EIU forecasting department, said.
“The potential debt crisis in any of these countries will spread rapidly to other developed countries and emerging markets, which will send the global economy to another downturn, which may be much worse,” she added.
IMF estimates that the Czech economy will decline by 6.5 percent this year, as it grew by 2.6 percent last year, due to the impacts of the global covid-19 pandemic. UniCredit Bank estimates that the Czech economy could fall by up to 11 percent this year.
The number of unemployed people, according to the consultancy Deloitte, could triple from 109,000 at the end of 2019 to 305,000 by the end of the year.