Coronavirus lockdowns to take 2 percentage points off 2020 growth each month, OECD says

30 Mar 20

Governments need to take “stronger, more coordinated measures” to absorb the economic impact of the coronavirus pandemic, the OECD has said, predicting each month of lockdown will knock two percentage points off global growth in 2020.

angel_gurria_oecd.jpg

Angel Gurría speaking at the press conference in Paris yesterday. Credit: OECD/Andrew Wheeler

OECD secretary-general Angel Gurría

Many economies will fall into recession, the organisation warned, with some sectors such as tourism facing contraction of up to 70%.

These recessions are “unavoidable”, the OECD said in a statement, as governments fight the pandemic, but efforts should be made to prepare the return of economic normality “as fast as possible”.

“The high costs that public health measures are imposing today are necessary to avoid much more tragic consequences and even worse impact on our economies tomorrow,” said OECD secretary-general Angel Gurría.

“Millions of deaths and collapsed healthcare systems would decimate us financially and as a society, so slowing this epidemic and saving human lives must be governments’ first priority.”

He said GDP growth would depend on many factors, especially the magnitude and duration of national lockdowns.

The OECD urged governments to continue to put money into their health systems and loosen trade restrictions on much-needed medical supplies.

But they should work far better together, by providing support to low-income and developing countries, as well as sharing best practices to support workers and keep businesses afloat.

“Our analysis further underpins the need for sharper action to absorb the shock, and a more coordinated response by governments to maintain a lifeline to people and a private sector that will emerge in a very fragile state when the health crisis is past,” Gurría said.

Did you enjoy this article?

Related articles

Have your say

Newsletter

CIPFA latest

Most popular

Related jobs

Most commented

Events & webinars