World bank projects global economy to shrink by 5.2pc in 2020- SBP sees restriction steps may have negative impact on Pakistan's economy.

Byline: S. Kamal Hayder Kazmi

According to the World Bank's latest Global Economic Prospects, in 2020 the global economy is on track to shrink by 5.2 percent amid the COVID-19 pandemic, the deepest recession since the Second World War. The Report also noted that the outlook for global economy is highly uncertain and downside risks are predominant, counting the possibility of a more protracted pandemic, financial upheaval, and retreat from global trade and supply linkages. Furthermore, the economic activity in advanced economies in 2020 is anticipated to contract 7 percent as local demand and supply, trade, and finance have been harshly disrupted.

Demographic Indicators Of Pakistan

Indicator 2018

Total population 212.82 Million (Approx.)

Population growth rate 2.4%

Contraceptive prevalence rate 34.2%

Unmet need of family planning 17.3%

Total fertility rate 3.6

Crude birth rate (per 1000) 25.2

According to the Report the US economy in this year is projected to shrink by 6.1 percent. Meanwhile the emerging market and developing economies (EMDEs), are predicted to contract by 2.5 percent in 2020, their first contraction as a group in at least 60 years. The economic activity in Latin America and the Caribbean, in particular, could plunge by 7.2 percent in 2020. Statistics showed that growth in East Asia and Pacific is projected to decline to 0.5 percent in 2020, the only region that could see growth in 2020.

The Chinese economy is predicted to rise by 1 percent in 2020. Economic experts also revealed that a downside condition in this year could lead the global economy to shrink by as much as 8 percent, followed by a sluggish recovery next year of just over 1 percent, with output in EMDEs contracting by almost 5 percent in 2020. It is also important to note that in the previous Global Economic Prospects report released in January, the multilateral lender projected global economy to increase by 2.5 percent in 2020.

The International Monetary Fund (IMF) in mid-April, projected in its World Economic Outlook that the global economy is on track to contract by 3 percent in this year as a result of the pandemic, and has presently signaled it would probable more cut forecasts in the near future. Statistics also showed that the World Bank's semiannual forecast for the global economy predicts a moderate recovery in 2021, with growth of 4.2 percent under the baseline forecast, which assumes that the pandemic recedes sufficiently to permit the lifting of...