Experts are still unable to forecast with certainty when the COVID-19 pandemic will end. The virus is still spreading panic and sickness worldwide. The economies of most countries have suffered as a result of this crisis. Experts are still unsure of what the full extent of damage done to the economy looks like, and countries continue to reel from the changes they have needed to make to face this pandemic. This article will analyze and assess some impacts of the coronavirus pandemic and how governments and international institutions alike are trying to secure the global economy to prevent further long-term damage.
Benjamin Gordon Palm Beach on Estimates of Damage to the Global Economy
According to Benjamin Gordon, early estimates had predicted that the pandemic would cause major economies to shrink in their 2020 annual GDP by at least 3 percent. However, later calculations set this statistic at 4.5 percent. This loss is huge, especially in terms of real numbers. For instance, the annual GDP of the world was close to 90 trillion dollars in 2019. A loss of 4.5 percent would mean that close to 3.5 trillion dollars would be lost in global economic output. In the end, this loss may trickle down to individuals and small businesses as well.
People will continue to face job losses, salary cuts, evictions, etc. New jobs will be harder to come by. This will cause people to spend less. The decreased spending, in turn, will mean that many sectorsof the economywill see a dip in sales and revenues. This could then lead to a reduction in production as a result of demand being so low.
How is the Global Economy Recovering?
In spite of the dangers that the coronavirus poses to the global economy, there isstill hope. Many governments are trying to adapt lessons learned from earlier financial crises to lessen the effects of low economic outputon their economies. These governments are trying to prevent a recession.
Many governments are trying to provide monetary assistance to their citizens, while also attempting to ensure that business owners have sufficient funds to sustain their businesses and retain staff. ECommerce and healthcare industries have gained much traffic duringthe COVID-19 pandemic. Artificial intelligence (AI) technology has improved greatly, which has helped tech companies increaseoutput, leading to an increase in revenue. Benjamin Gordon Palm Beachbelieves that the coronavirus has created an opportunity that is prudent for the global economy – this pandemic offers economies the chance to reorganize themselves completely.
The negative impacts of the coronavirus pandemic are clear. Economies of almost every country have shrunk. Still, there are many efforts in place to prevent the economy from facing further damage. Government spending has increased. This has helped to boost business ventures that are suffering in order to keep them, at the very least, functioning. The pandemic has also forced tech companies to innovate in order to provide more output.