World Bank has released its flagship report titled “Global Economic Prospects (June 2020)”. The report assesses the impressions of the pandemic and also examines the possible courses and outcomes. The report describes a grave near-term outlook and states that there is a contraction in global GDP which was 5.2 percent in 2020 due to the COVID-19 pandemic. This is the deepest global recession in eight decades that the world has witnessed. The COVID-19 pandemic has spread to every part of the world and infected millions worldwide.
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About World Bank:
The World Bank Group, established in 1944 and headquartered in Washington, D.C., is a vital source of financial as well as technical assistance to developing countries around the world. It is an unique partnership that aims to reduce the poverty and seeks to support development. Present President of the World Bank Group is David Malpass. The World Bank Group comprises of five institutions which are managed by its 189 member countries. These five institutions are as follows:
- International Bank for Reconstruction and Development (IBRD)
- International Development Association (IDA)
- International Finance Corporation (IFC)
- Multilateral Investment Guarantee Agency (MIGA)
- International Centre for Settlement of Investment Disputes (ICSID)
About Global Economic Prospects (June 2020):
World Bank has released its flagship report titled “Global Economic Prospects (June 2020)”. The report assesses the impressions of the COVID-19 pandemic and also examines the possible courses and outcomes. It indicates the clear actions needed by the global community and national policymakers—to restrict the harm, recover, and rebuild better and stronger than before. The report also includes an exhaustive analysis of the outlook for emerging market as well as developing economies, hence it investigates the depth and breadth of the economic and humanitarian storm. It states that COVID-19 has triggered a global crisis like no other, and it is leading to the deepest global recession since the second world war. If the pandemic is not controlled by the world economies then it will result in output contractions across the vast majority of emerging market and developing economies (EMDEs).
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Outlook of various economies mentioned in the report:
- The report forecasts a 5.2%contraction in global GDP in 2020 i.e. the deepest global recession in eight decades that the world has witnessed.
- The GDP of India is expected to contract by 3.2% in 2020, while it is expected to expand by 3.1% in 2021.
- The GDP of advanced economies is expected to contract by 7% in 2020.
- The GDP of U.S. is expected to contract by 6.1% in 2020.
- The GDP of Japan is expected to contract by 9.1% in 2020.
- The GDP of Emerging market and developing economies (EMDE) is expected to contract by 2.5% in 2020.
- The GDP of China is expected to become slow by 1.0% in 2020.
- The GDP of Russia is expected to contract by 6% in 2020.
The Global Economic Prospects (June 2020) states that all major economies worldwide have experienced COVID-19 outbreaks. Due to the pandemic, domestic demand and supply, trade, and finance have all been severely disrupted in the advanced economies, as a result they are expected to contract sharply. The report also expects the growth to rebound in 2021 but with the assumption that COVID-19 pandemic does not lead to lasting damages to financial systems and would be aided by unprecedented support from fiscal, monetary, and financial sector policies.
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