“Source:- Economic Times”
New Delhi: The Asian Development Bank (ADB) on Friday said the COVID-19 could reduce global gross domestic product (GDP) by 0.1-0.4%, with financial losses forecast to reach between $77 billion and $347 billion.
Economic growth in China and developing Asia, excluding China, could be trimmed by 0.3 to 1.7% and 0.2 to 0.5%, respectively, the ADB said in an analysis that outlined best-and worst-case scenarios.
“There are many uncertainties about COVID-19, including its economic impact,” said ADB Chief Economist Yasuyuki Sawada.
The virus outbreak could lead to sharp declines in domestic demand, tourism and business travel, trade and production linkages, supply disruptions, hurting growth in developing Asia.
In a moderate scenario, where precautionary behaviors and restrictions such as travel bans start easing three months after the outbreak intensified and restrictions were imposed in late January, global losses could reach $156 billion, or 0.2% of global GDP. China would account for $103 billion of those losses—or 0.8% of its GDP. The rest of developing Asia would lose $22 billion, or 0.2% of its GDP.
India could see a 0.003% decline in tourism revenues or $84.2 million in the best case scenario and 0.009% or $252.7 million fall in the worst case scenario.
As per the report, the coronavirus outbreak will have a significant impact on developing Asian economies through numerous channels, including sharp declines in domestic demand, lower tourism and business travel, trade and production linkages, supply disruptions, and health effects.
However, the multilateral lender cautioned that these should not be interpreted as predictions that an outbreak will occur but are meant to provide guidance for governments as they consider appropriate responses.