My readers know that I have written a lot on Covid pandemic. How it has been the biggest tragedy and disruption faced by mankind since the World War 2, the way it has impacted the way we lived our lives and the way we are going to live in future, new terminology associated with it such as lockdown, social distancing etc, plight of immigrants and the new normal, but as far as it’s impact on the global economy is concerned, I have generally been a little evasive in the absence of concrete figures. Now I have come across this article that first gives the size of the world economy in 2019, impact of Covid in the first two quarters of 2020 and its forecast for 2021. I found the impact to be much more severe than what was originally estimated and therefore, thought of sharing with my readers.
The above voronoi-style visualization relies on gross domestic product (GDP) data from the World Bank to paint a picture of the global economy—which crested to $87.8 trillion in 2019.
The United States continues to have the top GDP, accounting for nearly one-quarter of the world economy. China also continued to grow its share of global GDP, going from 15.9% to 16.3%.
Rank Country GDP % of Global GDP
1 🇺🇸 U.S. $21.4T 24.4%
2 🇨🇳 China $14.3T 16.3%
3 🇯🇵 Japan $5.1T 5.8%
4 🇩🇪 Germany $3.9T 4.4%
5 🇮🇳 India $2.9T 3.3%
6 🇬🇧 UK $2.8T 3.2%
7 🇫🇷 France $2.7T 3.1%
8 🇮🇹 Italy $2.0T 2.3%
9 🇧🇷 Brazil $1.8T 2.1%
10 🇨🇦 Canada $1.7T 2.0%
Top 10 Countries account for $58.7 trillion or 66.9% if the total.
According to the World Bank, the global economy could ultimately shrink 5.2% in 2020—the deepest cut since WWII.
See below for World Bank projections on GDP in 2020 for when the dust settles, as well as the subsequent potential for recovery in 2021.
Country/ Region / Economy Type 2020 Growth Projection 2021E Rebound Forecast
United States -6.1% 4.0%
Euro Area -9.1% 4.5%
Advanced economies -7.0% 3.9%
Emerging economies -2.5% 4.6%
East Asia and Pacific -0.5% 6.6%
Europe and Central Asia -4.7% 3.6%
Latin America and the Caribbean -7.2% 2.8%
Middle East and North Africa -4.2% 2.3%
South Asia -2.7% 2.8%
Sub-Saharan Africa -2.8% 3.1%
Global Growth -5.2% 4.2%
Source: World Bank Global Economic Prospects, released June 2020
The above figures are scary to say the least. A 5% plus shrinkage is apocalyptic and can hurt economies such as India very deep. Rebound in 2021 will much depend upon how soon the world gets rid of pandemic through either vaccination or cure – both looking slightly hazy and distant at present.
Let’s look heavenly and hope for a miracle! After all miracles do happen and there’s nothing very miraculous about a miracle happening when the mankind is facing its worst crisis in years.