São Paulo – The world economy is expected to go through a recession of almost 1% due to the COVID-19 pandemic, as per a report released on Wednesday (1st) by the United Nations Economic and Social Council (ECOSOC). The world production scenario could be even worse if restrictions in economic activities continue during the third quarter and countries can’t support their populations’ income and spending.
The council believes that a fiscal stimuli package prioritizing healthcare spending to keep the spread of the virus at bay and providing money support to the families most affected by the pandemic would help minimize the chance of a profound economic recession. A first analysis sees large-scale impacts, with unemployment, underemployment and in-work poverty as consequences.
ECOSOC reported that isolation restrictions have strongly impacted the service sector, such as retail, leisure, hospitality, recreation and transport. These areas account for a quarter of the world’s jobs. The economic impact could be largely determined by the duration of the restrictions and the amount and effectiveness of the countries’ fiscal response.
Translated by Guilherme Miranda
