The secretary-general of the Organisation for Economic Co-operation and Development (OECD) claimed that the global economy would take years to recover from the pandemic. He also noted that states are undergoing economic shocks that could generate worse effects that the financial crises in recent years.
The OECD secretary-general Angel Gurria told BBC that the government would take years to recover from the current economic crisis caused by the pandemic. He claimed that states should impose spending rules to ensure the speedy testing and treatment of affected communities to prevent irreparable outbreaks all over the world.
Gurria also perceived that the current situation may escalate to the global growth of 1.5 percent and that this number could be an optimistic estimate. He also noted that the number of job losses and closed companies remains uncertain and would only be increased if a global economic solution is yet to be found. He also noted that the situation could worsen if governments fail to deal with the economic fallout faster.
He also noted that even if the global economy would not fall into a worldwide recession, it would be highly likely that there would be no growth or that the yields would turn negative in many states.
Gurria also discussed that the economic uncertainty that the pandemic brings and the length of such adverse effects remain unknown. He even noted that the results thereof would be a greater shock than what the 2008 financial crisis brought including the September 11 terror attacks combined.
Gurria also highlighted the lack of governments' capacities to address the increasing unemployment rates because there is no certain number of workers that would be greatly affected by the pandemic. He also claimed that hundreds of thousands of small and medium enterprises are already suffering its adverse effects.
However, the report claimed that some governments have already addressed their economic troubles including extending the support for workers and vulnerable businesses during lockdowns.
Policymakers in the United Kingdom have already imposed wage rates for employees that would be deprived of work due to community quarantines and lockdowns. Gurria further called on governments to ease borrowing rules and promote financial aid to its maximum during the pandemic.
He also warned that bigger deficits and larger debt rates are to be expected and that these would weigh heavily on already highly indebted countries for the coming years.
Speaking about the extent of recovery, Gurria claimed that policymakers from the G20 club of wealthy nations perceived a 'V' shape recovery strategy. He explained that this involved short, sharp drops in economic activity followed by a rebound in growth.