Lockdowns leave trillion-dollar hole in global economy

DUBLIN: A stronger-than-expected rebound this year will still leave the world down an estimated 10 trillion dollars due to the coronavirus pandemic and lockdowns, according to the United Nations Conference on Trade and Development (UNCTAD)
Although the global economy could expand by 4.7 per cent in 2021, it will nonetheless wind up “short of $10 trillion” -about twice Japan’s gross domestic product (GDP) – compared to if the pandemic had never happened, according to UNCTAD.
Last year, the global economy “posted its sharpest annual drop in output since statistics on aggregate economic activity were introduced in the early 1940s,” UNCTAD said in a new report.
While wealthy economies have proposed huge damage-limitation fiscal spending, such as the United States’ $1.9-trillion” stimulus package,” and while China returned to growth in late 2020, people in smaller and poorer countries are struggling, UNCTAD warned.
Developing countries are bearing the brunt of the downturn due to ”limited fiscal space, tightening balance of payments constraints and inadequate international support,” leading to “some of the largest personal income drops relative to GDP.” — dpa