World Economy in Deep Recession in 2020, Growth to Be -4.4%, Predicts IMF

Employment has partially rebounded after having plummeted during the peak of the crisis. This crisis is however far from over. Employment remains well below pre-pandemic levels and the labour market has become more polarised with low-income workers, youth, and women being harder hit, she added. She further said the poor are getting poorer with close to 90 million people expected to fall into extreme deprivation this year.

The ascent out of this calamity is likely to be long, uneven, and highly uncertain. It is essential that fiscal and monetary policy support are not prematurely withdrawn, as best possible, Gopinath said. Gopinath said that except for China, where output is expected to exceed 2019 levels this year, output in both advanced economies and emerging market and developing economies is projected to remain below 2019 levels even next year.

Countries that rely more on contact intensive services and oil exporters face weaker recoveries compared to manufacturing-led economies. The divergence in income prospects between advanced economies and emerging and developing economies, excluding China, triggered by this pandemic is projected to worsen, she said.