The Strategist

UN: Global economy shrinks by 4.3% in 2020

01/26/2021 - 05:29

With the COVID-19 coronavirus pandemic and restrictive measures, the global economy shrank by 4.3% in 2020, according to the UN World Economic Situation and Prospects report. The crisis caused by the virus has been described as the worst in 90 years.

"World GDP in 2020 fell by about 4.3%, which was the sharpest decline in output since the Great Depression. During the Great Recession of 2009, global output fell by 1.7%," the report said. A 4.7% recovery is expected in 2021.

UN experts estimate that the pandemic hit developed countries hardest, as many European countries and some US states adopted strict quarantine measures at the start of the pandemic. "Production in developed countries is expected to decline by 5.6% in 2020, with growth projected to recover to 4.0% in 2021," the study specifies.

"We are experiencing the worst health and economic crisis in 90 years. As we mourn the rising death toll, we must remember that the choices we make now will determine our collective future," commented UN Secretary General António Gutteres on the report's findings. Earlier he had compared the pandemic situation to the aftermath of World War II.

In September 2020 the Global Pandemic Preparedness Monitoring Board, organised by the WHO and the World Bank, published its report on the first wave of the pandemic. It estimates that it will cost the global economy more than $11 trillion, with another $10 trillion in lost income. 

According to experts, if the coronavirus pandemic reaches the scale of pandemic flu H1N1, which began in 1918 and killed about 50 million people, it will cost the global economy another $3 trillion, or 4.8% of GDP. According to the latest figures, the number of people worldwide infected with the coronavirus has almost reached 100 million, with more than 2.1 million deaths.


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