IMF's Georgieva Says Global Growth To Be Deep Below 2019 Level On COVID-19

Global growth this year would be much lower than 2019 level as the coronavirus, or COVID-19, spreads to several countries hurting economic activity, International Monetary Fund Managing Director Kristalina Georgieva said Wednesday. "Under any scenario, global growth in 2020 will fall below last year's level," Georgieva said during a press briefing, where she was joined by World Bank Group President David Malpass.

"How far it will fall, and for how long, will depend on the coronavirus epidemic, but also on the quality, timeliness, and effectiveness of policy actions," she added.

Georgieva said there has been a shift to a more adverse scenario for the global economy last week. The new projections will be presented in the latest update to the World Economic Outlook over the coming weeks, she said. In the January update to the World Economic Outlook, the IMF had projected global growth to improve to 3.3 percent this year from 2.9 percent last year.

The economic shock caused by the COVID-19 outbreak is "unusual" as it affects both supply and demand, Georgieva said. The IMF could quickly disburse $50 billion through its emergency financing facilities to low income and emerging markets countries that do not require full-fledged rescue measures, she added.

Late Tuesday, the World Bank announced an aid of up to $12 billion as immediate support for countries to respond to the virus outbreak. The package will include emergency financing, policy advice, and technical assistance, Malpass reiterated.

Earlier on Wednesday, the International Monetary and Financial Committee said after a conference call that the 189 member countries of the IMF are determined to provide the necessary support to mitigate the impact, especially on the most vulnerable people and countries.

The parent organization of IMF called upon the lender to use all its available financing instruments to help member countries in need. "We are confident that, working together, we will overcome the challenge facing us and restore growth and prosperity for all," the IMFC said in a statement.

In other developments, the IMF and the World Bank decided on Tuesday that the 2020 Spring Meetings, scheduled for April, will be held virtually to ensure the health and safety of participants and staff due to the fears around the COVID-19.