Bad news, only bad news the world has received from international or multilateral organizations and institutions, such as the International Monetary Funds (IMF), the World Bank (WB), the World Trade Organization (WTO) or the Asian Development Bank (ADB), on the perspectives of the world economy and trade for this year, of course because of the coronavirus pandemic.
| Illustrative photo |
In their newly published forecasts, all above-mentioned financial, monetary and trade multilateral institutions have shown from negativism to extreme pessimism about the state of the world economy and trade at present and in the near future. The IMF believed the world economy has already fallen into recession. The WB also predicated clear recession. The ADB and the WTO put forward concrete data showing sharp decreases in growth rate of the world economy as well as of that of almost all countries in the world.
The Great Depression of 1929 and the financial and public debt crisis of 2008 – 2009 have been the grounds for comparing with this year's pandemic. All conclusions drawn from the comparisons are the same, namely the world economic recession would be inevitable and there would be not a simple but a great recession, even worse than ever before. All are bad news for now.
It is true that the pandemic has negatively and seriously affected the world economy. Other true fact is that nobody can say for now how long will this pandemic last. But it is also true that the crisis caused by this pandemic differs basically and profoundly from the crises of 1929 and 2008-2009. It is related to both the demand side and the supply side. It is not a financial, monetary or production crisis. And it hits all countries and territories in the world at the same time. There isn't still any vaccine or medication against it. It paralyzes almost the whole world.
Therefore it can become much more dangerous and harmful for mankind. In the light of theses circumstances, it’s understandable the prevalent bleak forecasts of world economy and trade.
Great recession? Sure! But world economic crisis? Surely not! Because the entire world has now no other choice and alternative but to resolutely fight against the pandemic, to roll it back and to push it away. It is the world's common struggle and not of only some countries like some times in the past. The needs to restore as quickly as possible the normal life are much more urgent for all countries than in the past crises. The politically strong will is already there. Unprecedented financial plans and credit lines from many countries and multilateral institutions are already there to support the handling of the pandemic, to rescue enterprises, to relieve the hardship of people and to prepare for economic and social development and growth in the post-pandemic time. Great recession may be unavoidable, but a new crisis of the world economy surely won't likely happen.
Disclaimer: The views expressed by Ambassador Tran Duc Mau are of his own and do not necessarily reflect the views of Hanoitimes.
