The consequences of the pandemic on the global economy

Abstract

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 most serious damage was inflicted to the states where the pandemics had caused an extremely complicated situation due to its spreading, and rather strict regulations had been enforced as a result of the stated. We talk about the states which are significantly dependent upon the world trade, tourism, exports of goods and international funding. Despite of the fact that an extent of the shock is different among regions, all states with developing economics have their own weaknesses that had been worsen much more by external shocks. In addition to the above-mentioned, interruption of school (auditory) education and poor availability of the primary health care will expectedly have a long-termed negative impact on development of the human capital. 

A forecast of the World Bank and world experts is based on assumptions that the recession caused by the pandemics will be overcome, that negative global impacts will be weakened in the second half of the current year and destruction of financial markets will be stopped. On their opinion, in the year of 2021 development of the global economics will be restored and reach 4,2%, and in the leading economics it will amount to 3,9%, in the developing states the economics rise will be accelerated up to 4,6%. On top of all, it is noteworthy, that the prospect is rather ambiguous and unclear against the background of existing negative risks; Last year economics of the USA was decreased by 6.1%, economics of the European zone – by more than 9%. All this was resulted by the epidemics which had a negative effect on business activities. In Japan, the economics was decreased as well; preventive activities implemented in the state decreased economic activity by 6.1%.

From different viewpoints, the recession caused by the COVID-19 pandemics is unique and, probably, the deepest one. According to the assessment made by Director of the Economics Development Prospects Researching Department of the World Bank, current events have already caused unprecedented behavioral reviewing of the forecast of rise of the world economics, that is unprecedented from the standpoint of its speed and stridency.

The current crisis leaves behind a very deep trace and global problems; thus, the top challenge is overcoming of health global and more complicated economic state. Following this, the world community should integrate mutual efforts to obtain ways of restoration of their economics in a maximally rapid and sustainable way to prevent increasing of the poverty and non-employment rates.