In order to stop the further spread of novel coronavirus, governments around the world have taken varying degrees of measures to block some countries and cities. This includes closing borders, closing schools and workplaces, and restricting large gatherings.To get more news about WikiFX, you can visit WikiFX news official website.
The unemployment rate is rising.
These restrictions, called the “Great blockade” (Great Lockdown) by the International Monetary Fund(IMF), caused many global economic activities to sink into stagnation and people to lose their jobs. It can be seen that this is a real challenge for the whole world. The worlds largest economy, America, has lost more than 2,600 million jobs in the past five weeks. The United States is not alone in facing rising unemployment. Unemployment has also risen in Australia and South Korea, with some economists warning that the situation could get worse.
Services are the main source of economic growth and employment in many countries, including the United States and China, the world's two largest economies and consumer markets. Even though the retailers such as Amzaon reported growing online sales, the whole online retailing sector has seen a decline.
As novel coronavirus spreads around the world, manufacturers are under pressure again. As more and more countries implement blockade measures, manufacturing enterprises are affected as well. Some factories have been forced to close temporarily, while those that remain open face restrictions on access to the supply of intermediate goods and materials. Most importantly, the decline in demand for goods has exacerbated the challenges facing manufacturers. As a result, factories in countries from US to Europe and Asia have reported a decline in output over the past month.
Global trade had slowed in 2019 and is expected to be further dragged down in 2020 by the novel coronavirus pandemic.
The World Trade Organization (WTO) said that in an optimistic scenario, the volume of global trade in goods will fall by 12.9% in 2020 and rebound rapidly by 21.3% in 2021, while in a pessimistic situation, the volume of global trade in goods will decline by 31.9% in 2020 and rebound by 24% in 2021. The WTO said that unlike during the financial crisis, the epidemic has a greater impact on the value chain and trade in services. In the electronics and automotive industries, where the value chain is more complex, trade is likely to fall sharply.
The impact of the novel coronavirus pandemic on economic activities has led many institutions to slash their forecasts for the global economy. The International Monetary Fund (IMF) has received widespread attention for its assessment of the global economy, which estimated a 3 percent global economic shrinkage this year. Only a few economies, such as China and India, are expected to grow in 2020, IMF said. Although the IMF expects economic growth to rebound 5.8 per cent next year, it said that “the recovery is only partial because the level of economic activities is expected to remain lower than what we forecast for 2021 before novel coronavirus' attack”.