COVID-19: Sharp slowdown in economic activity has created Crisis

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Barkatullah;

The IMF said coronavirus pandemic is pushing the public economy into it’s deepest recession in a century , cutting world output by 3% this year , and the crisis could get worse and if the virus is contained and economies can begin operating again, 2021 should see a rebound of 5.8% according to the IMF. However, with much of the global economy shutdown , the countries have experienced the worst year for economy weakness. Since the virus poses an additional challenge for the complete world. For combating it the world has dramatically attempt great responses . Eventually a vaccine would not get found to treat coronavirus patients . Although China , which got the victory over COVID-19 and successfully contained it , but China’s economy is expected to expand by just 1.2% this year, which would be the slowest growth since 1976 . And Australia is expected to suffer it’s first recession since 1991. The IMF also predicted that the UK economy will shrink by 6.5% in 2020, compared with the IMF’s January forecast for 1.4% GDP growth. Now the question arises could the world be heading for another financial crisis ? The coronavirus pandemic caused an unprecedented health crisis and the latest Global Financial Stability Report shows that the financial system has already felt a dramatic impact and the further intensification of the crisis could affect global financial stability . To preserve the stability of the global financial system and support the global economy, central banks across the globe have been the first line of defense . Nonetheless , the resilience of banks may be tested in the face of a sharp slowdown in economic activity . Italy , Spain and Austria have allowed partial returns to work as countries across Europe has reported further falls in new COVID-19 cases and began taking their first cautious steps out of lockdown to revive battered economies. And Pakistan’s economy is previously sabbotaged and due to the coronavirus pandemic the economy is affectively disturbed . It merits a mention that the country has also suffered from wheat crisis and the pandemic has an acute impact on export and import in the country and yet the PM is dealing with them. The impact of the pandemic would also hit hard- low income people especially informal workers in the hospitality , retail trade , and transport sectors who have limited or no access to health care or social safety nets.