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IMF warns about the long-term effects of coronavirus on global economy

UNITED STATES (OBSERVATORY NEWS) — Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), considers it appropriate to prepare for an unfavorable scenario and not expect an immediate liquidation of the consequences of the new coronavirus for the global economy.

According to the organization’s press service, with such a warning Georgieva spoke on Sunday to the participants in the meeting of finance ministers and central bankers of the G20 countries in Saudi Arabia.

The head of the IMF recalled that the fund in January predicted an increase in global GDP growth from 2.9% last year to 3.3% this year.

“The projected economic recovery, however, is fragile and depends on normalizing conditions in countries with stressful and inefficient economies,” continued Georgieva, calling the coronavirus (2019-nCoV) “primarily a human tragedy that has a negative impact on the economy.”

“I reported to the G20 that even if the virus is quickly stopped, it will affect [economic] growth in the world and China. Naturally, we all hope for a sharp and quick recovery, however, given the current uncertainty, preparing for the least favorable scenarios,” said the head of the IMF, mentioning the danger of an expanding outbreak caused by 2019-nCoV.

Georgieva called the key areas for consolidating the efforts of the G20 in countering the spread of coronavirus. First of all, she offered the IMF assistance at the expense of funds intended to eliminate the consequences of major disasters. “Despite the first phase [of the US-China agreement on the settlement of trade disputes], the aggravation of trade relations cut off 0.6% of world GDP.

The key is now the transition from a trade ceasefire to a trading world,” said Georgieva, emphasizing the importance of the G20 platform to ensure stability of the global economy.

The outbreak of the disease caused by the new coronavirus (2019-nCoV) was recorded at the end of December 2019 in the most populous city in Central China – the 12 millionth Wuhan.

The World Health Organization recognized it as an emergency of international proportions, describing it as an epidemic with many foci. Outside of China, cases of infection were detected in 27 countries, including Russia.

The Chinese authorities recorded 2442 deaths in the country, almost 22.9 thousand people recovered, the number of people infected during the entire spread of the virus is close to 77 thousand.

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