IMF predicted the worst crisis since the Great Depression

The International Monetary Fund has been waiting for the worst recession since the Great Depression. In an updated forecast - the fall of the global economy by 3%, Russian - by 5.5%.

What's happened?

In January, the IMF expected that the world economy in 2020 would grow by 3.3%, now predicts the same fall. According to its economists, this recession will be much deeper than the 2009 financial crisis and will become the worst since the Great Depression. Good news - taking into account unprecedented measures to support the economy by governments, in 2021 it can tear at once by 5.8%. But in the next two years, the IMF estimates the total losses of the global economy at $ 9 trillion, noting that this is more than the total GDP of Germany and Japan.

Why is this crisis compared with the Great Depression

The IMF economists call this crisis Great Lockdown (large quarantine) and it is not accidental compared with great depression-in 2020, for the first time since the 30s of the last century, both developed and developing economies are expected.

Developed countries will lose 6.1% of GDP.
Developing - about 1% or 2.2%, if China is excluded from their number.
Plush income will fall in at least 170 countries.

The IMF admits that the fall of the global economy by 3% is only a basic scenario. If the pandemic cannot be defeated quickly and the second half of the year will also pass “under quarantine”, the fall will be 6%.

What awaits Russia

The Russian economy, according to the Basic scenario of the IMF, will fall by 5.5% this year - at the level of other developing countries in Europe and, for example, Latin America. Next year in Russia, it is possible to restore growth up to 3.5% against modest 1.3% in 2019. There is only one good forecast - unemployment in the country, according to the IMF, will grow slightly - from 4.6% to 4.9%.

The Forecast of the IMF in Russia is close to the consensus forecast of Russian economists, presented today in the report of the Liberal Mission Foundation, Koronakrisis-2020, edited by Kirill Rogov. Sergey Guriev, Konstantin Sonin, Oleg Vyugin and other famous economists participated in its compilation.

The authors of the report calculate three scenarios:

The optimistic scenario involves the price of oil $ 40 per barrel, the growth of the global economy is 0.7%, but the fall of the Russian by 3.7%.
Moderate - $ 31 per barrel, a fall in the economy by 1.9% in the world and 5.7% in Russia.
Pessimistic - $ 24 per barrel, the collapse of the global economy by 3.7%, and Russian - by 8.6%more than in the crisis 2009, when the fall of the Russian GDP was 7.9%.

In order to prevent the economy into depression due to the coronavirus epidemic, Russia must allocate 4-10 trillion rubles for its support, spend half of the FNB and launch a quantitative softening program-that is, in fact a printing press, Russian economists say .