Due to COVID-19... OECD Lowers Growth Forecast to 2.4%

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Cho Hyun-ui] The Organisation for Economic Co-operation and Development (OECD) has warned of the possibility of a global economic recession due to the spread of the novel coronavirus infection (COVID-19).

On the 2nd (local time), the OECD presented a global economic growth forecast of 2.4% for this year through its interim economic outlook. This is a downward revision of 0.5 percentage points (p) from the 2.9% forecast released in November last year.

If the prediction is accurate, the global economy will experience its lowest growth since 2009, right after the financial crisis. However, the growth forecast for 2021 was revised upward from the previous 3.0% to 3.3%. This growth forecast is based on the basic scenario that COVID-19 will peak in China in the first quarter and will be relatively less severe or controlled in other regions.

If COVID-19 spreads worldwide, including Asia, Europe, and North America, the global economic growth rate this year is expected to plummet to 1.5%. Under the basic scenario, China's economic growth forecast for this year was lowered from 5.7% in the November forecast to 4.9%. The Eurozone (19 member countries using the euro) growth forecast slightly dropped from 1.2% to 1.1%.

The OECD predicted that Italy, where the spread of COVID-19 in Europe is the fastest, will have zero (0) growth this year. The U.S., where the impact of COVID-19 is still limited, saw its growth forecast for this year lowered only by 0.1 percentage points, from 2.0% to 1.9%.

According to major foreign media, Lawrence Boone, OECD Chief Economist, said, "The message from the downside scenario (where COVID-19 spreads worldwide) is that many countries could fall into recession," adding, "Therefore, we urge affected regions to take measures as quickly as possible."

This content was produced with the assistance of AI translation services.