The impact of the pandemic on the world economy

Abstract

In connection with the issue being under consideration, too many works have already been published; they were analyzing the negative impact caused by the COVID-19 virus pandemics on the global economics. On top of all, it seems to be a very complicated challenge and serious danger not only for the world health care system, but for the global economics as well. After the initial shock, researchers started analyzing of results of the recession resulted by the pandemics more actively. However, there is no exact information on the extent of impact of these processes on the global economics, geopolitics, social relations, and unemployment rate. Researches and reports conducted by international organizations give an inhomogeneous assessment of the pandemics’ impact on the global economics.

Covid-19 (corona virus) has turned to be a rather complicated challenge and serious danger not only for the world health care system, but for the global economics as well. A virus originated in Wuhan in November-December of 2019, just in some months, transformed into the pandemics with a focal negative impact on the world economics which is irreversible. Definitely, it is very difficult to make a forecast on the economic impacts caused by the pandemic process and epidemic states existing in different countries from the viewpoint of the global economics.

Despite of the fact that expectations are different, generally, huge economic effects will be suffered by the countries where there had been the highest indicator of spreading of COVID-19 registered, followed by the countries with the economics much depended upon tourism, export of petroleum products and other goods, and finally the negative impact will be reflected on the economics of their partner-countries. These are the key issues which will be analyzed in the present article. 

The Coronavirus pandemics and quarantine measures implemented for its elimination turned to be dramatic and horrifying for the global economics as a result of which it entered into a deep recession. According to the World Bank, global economics had been decreased by 5,2% in 2020. It is the deepest fall since the times of the Second World War and is the most large-scaled decrease in quantity of products per capita in majority of countries since the year of 1870. The stated problem was discussed in the report of the World Bank issued in June 2020.

Against the background of the huge shock having an effect on domestic (internal) supplies and demand, trade and funds, economic activity was decreased by 7% in the states with developed economics, and by 2,5% in the states with developing economics last year. This is the first all-embracing recession in economics of this group within the last sixty years at least. Income per capita was decreased by 3,6%, that will drag millions of people in the uttermost poverty.

Accordingly, it may be mentioned definitely, that the world economics has already been in recession as an impact of the coronavirus pandemics restricts the economic activity and has a negative effect on it. There is no doubt that only global and wide-spread struggle against the pandemics will have a result.  It is confirmed by majority of experts that situation may be controlled rapidly and influence of the virus on the global economics will be essential, but short-termed, as it used to be in case of the SARS virus appeared in 2003. In the second quarter, economic rise will be stabilized if we receive this scenario as a base like majority of analysts, an impact on the global economic will be negative, but limited. In addition to it, a key issue remained in the economic forecast is a depth and duration of recession which should be slowed significantly in 2021. Here, active assistance to the health care sector and a struggle using  epidemiological global vaccination is an issue of great importance that will give a possibility to the states to facilitate regulations and to enable business to apply the whole potential of its resources.