OECD: Virus triggered worst global recession in century — even without 2nd wave

The virus crisis has triggered the worst global recession in nearly a century — and the pain is not over yet even if there is no second wave of infections, an international economic report warns.

Hundreds of millions of people have lost their jobs, and the crisis is hitting the poor and young people the hardest, worsening inequalities, Organization for Economic Cooperation and Development says in its latest analysis of global economic data.

“It is probably the most uncertain and dramatic outlook since the creation of the OECD,” Secretary General Angel Gurria says. “We cannot make projections as as we normally do.”

In the best-case scenario, if there is no second wave of infections, the agency forecasts a global drop in economic output of 6% this year, and a rise of 2.8% next year. If the coronavirus re-emerges later in the year, however, the global economy could shrink 7.6%, the OECD says.

“With or without a second outbreak, the consequences will be severe and long-lasting,” the report says.

Global stock markets dropped after the release of the report, which is more downbeat than other forecasts from the likes of the World Bank.

In case of a second wave of contagions, the OECD forecast that the average unemployment rate across the 37 developed countries that it represents would double this year to 10% and see “little recovery” in 2021. In the more optimistic scenario, the figure would be 9.2%. In poorer countries, the numbers are often higher, and informal workers are especially vulnerable.

— AP