Social isolation measures to curb the COVID-19 epidemic have hit business and plunged the world into the worst economic recession since the 1930s, the Australian Financial Review reported. The global economic is expected to shrink by 3 per cent this year and the Australian economic by 6.7 per cent.
The International Monetary Fund (IMF) predicts a 6.1 per cent V rebound next year if the epidemic peaks in the next three months and social isolation policies ease in the second half of the year after a sharp economic recession. The fund, however, forecasts annual economic output will be lower than in 2019, and unemployment will rise to 9% next year, even if economic returns strongly in 2021.
The global economic growth is expected to shrink by 3 per cent this year, compared with the 0.1 per cent economic contraction caused by the 2009 global financial crisis, mainly because the epidemic affected China and spread to Europe, the United States and other regions. For the next two calendar years ,$9 trillion ($14 trillion) could be wiped out globally, exceeding the combined size of the economic of Japan and Germany.
The head of the IMF delegation to Australia Harald Finger said that Australia "will face the first 30-year recession ". "The stringent measures Australia has put in place to curb COVID-19 and economic dependence on commodities and tourism and huge household debt have all contributed to the sharp contraction ," he told the Australian Financial Review. "
It is reported that for the first time since the 1991 economic recession, Australia has faced a sudden halt to economic consecutive growth for 28 years. Although the outlook is not optimistic, on Tuesday (14) the Australian dollar still hit above 64 cents, reaching a one-month technical high, Australian stocks rose 1.9 percent, has rebounded 20.7 percent since March 23, and technically entered a new bull market.
Commodity exporters are vulnerable
IMF said commodity prices would be depressed because of weak global demand. Analysts say the government stimulus will affect prices of Australia`s main mineral exports (iron ore and coal).
The Gita Gopinath, chief economics IMF, said the policy of social segregation had led to a sharp collapse of the economic ," which we have never experienced in our lifetime ".
"It was an extraordinary crisis and the impact on people`s lives and livelihoods was uncertain ," she said. it largely depends on the epidemiology of the virus, the effectiveness of containment measures and the development of medical, vaccine. "
"Many countries are facing multiple crises, including health, finance and the collapse of commodity prices, all of which are complex interactions. "
Finance Minister: No relaxation of social isolation restrictions
The daily mail reported that COVID-19 the outbreak continued, australia government imposed a blockade order, has seriously hit australia economic. because of the recent epidemic has gradually slowed, many people called for government to relax the blockade measures to allow economic to resume. Federal Finance Minister Josh Frydenberg objected that too soon to relax restrictions would lead to the risk of a second wave of outbreaks.
Australia has managed to flatten the infection rate curve with new cases remaining at 2%. For the first time this week, the cure rate surpassed newly diagnosed cases. The data prompted many commentator to call for government to ease the restrictions imposed last month.
Frydenberg was asked Allison Langdon the moderator on Thursday (16) in Today Show program if government had plans for four to six weeks to reopen the school. Frydenberg indicated that some countries had eased restrictions immediately after the outbreak began to decline, resulting in a resurgence of infection rates and the need to revive the closure order.
"We can look at Japan and Singapore, where they thought they had made progress in controlling the epidemic and started easing restrictions, but there was a second wave of infection at home ," he said. "
It is reported that many businesses have chosen to close because of the sharp decline in customers, which caused tens of thousands of people to lose their jobs. The Australian Treasury forecasts unemployment will rise to 10% by the end of June. The most recent unemployment rate of 10 per cent was in early 1994. economics worry that more than a million Australians have lost their jobs as a result of the COVID-19 epidemic.
To help people get through the difficulties, government have implemented a JobKeeper plan to provide subsidies to businesses, so that businesses can retain employees, employees can also keep their jobs.
The Federal government and the Australian Reserve Bank have reportedly spent $320 billion to rescue economic. since the outbreak
