World economy to shrink 3.2pc in 2020: UN

NEWS DESK

The world economy is projected to shrink by 3.2 per cent in 2020 after the coronavirus pandemic sharply restri­cted economic activity, increased uncertainty and sparked the worst recession since the depression, the United Nations said on Wednesday.

A report by the UN Department of Economic and Social Affairs said there would likely only be a gradual recovery of lost output in 2021. In January, the department had projected world economy growth of between 1.8pc to 2.5pc this year.

"The world economy is expected to lose nearly $8.5 trillion in output in 2020 and 2021, nearly wiping out the cumulative output gains of the previous four years," the report said on Wednesday.

The UN report said the pandemic showed how economic and public health "are inextricably linked and mutually reinforcing."

"Countries may seek to reduce inter-dependence, and shorten supply chains, as many may consider the potential costs of a crippling pandemic too high relative to the benefits they receive from economic integration and interdependence," it said.