Global economy could witness losses up to $8.8 trillion: ADB

New Delhi, May 15

Of this, the impact on South Asian gross domestic product (GDP) will be to the tune of $142-218 billion.

“The global economy could suffer between $5.8 trillion and $8.8 trillion in losses — equivalent to 6.4% to 9.7% of the global GDP — as a result of the novel coronavirus disease (Covid-19) pandemic,” ADB said in a new report subsequent to its economic outlook released in early April.

The GDP in South Asia will also be lower by 3.9-6%, mainly reflecting the tight restrictions in place in countries like Bangladesh, India and Pakistan, ADB said in is updated assessment of the Potential Economic Impact of Covid-19.

The Manila-headquartered multi-lateral funding agency said the economic losses in Asia and the Pacific region could range from $1.7 trillion under a short containment scenario of three months to $2.5 trillion under a long containment scenario of 6 months, with the region accounting for about 30% of the overall decline in global output.

The People’s Republic of China (PRC) could suffer losses between $1.1 trillion and $1.6 trillion.

In the Asian Development Outlook (ADO) 2020 published on April 3, the agency had estimated Covid-19’s global cost to range from $2 trillion to $4.1 trillion.

Earlier on March 6, it had estimated the economic impact globally ranging from $77 billion to $347 billion (0.1 to 0.4% of global GDP).

ADB said its new analysis which expects global impact of $5.8-8.8 trillion is excluding the impact of policy measures.

The agency’s new estimate is more than double the World Bank’s estimate of 2-4% decline in global GDP and higher than the IMF’s World Economic Outlook estimate of 6.3% decline in global GDP. — PTI