Worst global recession in nearly a century: OECD

The global economy faces the most severe recession in nearly a century and could see 6% contraction in 2020 and rebound to 5.2% growth in 2021, provided the second wave of Covid-19 infections is avoided, OECD said in its outlook, adding that China’s and India’s GDPs will be relatively less affected, with a decrease of 3.7% and 7.3% respectively in case of a double hit, and 2.6% and 3.7% in case of a single hit.

Several economists, banks and multilateral agencies have forecast a contraction for India’s economy in 2020-21 and a feeble recovery in 2021-22 as the impact of the lockdown to prevent the spread of Covid-19 deeply hurts several key sectors of the economy.

The body presented two scenarios for global growth and jobs. It said if a second outbreak occurs triggering a return to lockdowns, world economic output is forecast to plummet 7.6% this year, before climbing back 2.8% in 2021. At its peak, unemployment in the OECD economies would be more than double the rate prior to the outbreaks, with little recovery in jobs next year. In both scenarios, the recovery, after an initial, rapid resumption of activity, will take a long time to bring output back to pre-Covid levels.

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