Difference between revisions of "The Impact of COVID-19 on Global Supply Chains and The Transport Sector"
(Created page with "by: Lauri Ojala '''INTRODUCTION''' '''The ”Big Picture” of COVID-19 impact on world economy in end-March 2020''' '''OECD estimates on 2 March 2020 on the impact of COVI...") |
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• In a mild scenario an average impact of -3.5% of GDP is expected for all countries analyzed. | • In a mild scenario an average impact of -3.5% of GDP is expected for all countries analyzed. | ||
| − | |||
| − | + | - The U.S. expected to enter into a recession, and the crisis is expected to cost it nearly 3% of its GDP | |
| − | + | - Most European countries will face significant recessions, seeing contractions of their GDP of 2% to 3%, causing significantly increased unemployment | |
| + | |||
| + | - China the only country with a GDP growth, slashed from a pre-crisis estimate of 6% to below 3% | ||
• If crisis measures are extended, each additional month of shutdowns will cost 2%-2.5% of global GDP. | • If crisis measures are extended, each additional month of shutdowns will cost 2%-2.5% of global GDP. | ||
| − | + | ||
| + | - If extreme COVID-19-related measures last until mid-June 2020, the U.S. will see its GDP fall almost 4%. | ||
| + | |||
| + | Italy and Germany will see their GDP fall close to 6%, and the UK more than 5%. ( Finland would suffer more) | ||
• If it lasts until the end of July 2020, the average decline in GDP would be close to 8%. And the decrease in GDP could, in some cases, be higher than 10%. | • If it lasts until the end of July 2020, the average decline in GDP would be close to 8%. And the decrease in GDP could, in some cases, be higher than 10%. | ||
| + | |||
link to material: https://www.ifors.org/wp-content/uploads/2020/04/COVID-19_Supply_Chain_Impacts_Ojala_UPDATE_20200401.pdf | link to material: https://www.ifors.org/wp-content/uploads/2020/04/COVID-19_Supply_Chain_Impacts_Ojala_UPDATE_20200401.pdf | ||
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[[Category: Industry]] | [[Category: Industry]] | ||
Latest revision as of 09:20, 2 April 2020
by: Lauri Ojala
INTRODUCTION
The ”Big Picture” of COVID-19 impact on world economy in end-March 2020
OECD estimates on 2 March 2020 on the impact of COVID-19 on GDP for years 2020 and 2021
OECD Base scenario: temporary blow
• Severe, short-lived downturn in China, where GDP growth falls below 5% in 2020 after 6.1% in 2019, but recovering to 6.4% in 2021.
• In Japan, Korea, Australia, growth also hit hard then gradual recovery.
• Impact less severe in other economies but still hit by drop in confidence and supply chain disruption.
Domino scenario: broader contagion
• Intensity of China impact repeated in northern advanced economies severely hitting confidence, travel, and spending.
• Global growth could drop to 1.5 per cent in 2020, half the rate projected before the virus outbreak.
• Recovery much more gradual through 2021.
Global recession almost “inevitable” IESE Business School’s Nuno Fernandes on economic impact of COVID-19 ( 24 March 2020 )
• Service-oriented economies particularly negatively affected, with more jobs at risk
• Countries like Greece, Portugal, and Spain that are more reliant on tourism (more than 15% of GDP) will be more affected by this crisis
• Countries more reliant on exports will suffer disproportionally (e.g. Finland)
• The report also attempts a rough estimate of the potential global economic costs of COVID-19 under three different scenarios: a shutdown of 1.5 months (from mid-March to end of April), of 3
months (lasting until mid-June), and of 4.5 months (until end of July.)
• In a mild scenario an average impact of -3.5% of GDP is expected for all countries analyzed.
- The U.S. expected to enter into a recession, and the crisis is expected to cost it nearly 3% of its GDP
- Most European countries will face significant recessions, seeing contractions of their GDP of 2% to 3%, causing significantly increased unemployment
- China the only country with a GDP growth, slashed from a pre-crisis estimate of 6% to below 3%
• If crisis measures are extended, each additional month of shutdowns will cost 2%-2.5% of global GDP.
- If extreme COVID-19-related measures last until mid-June 2020, the U.S. will see its GDP fall almost 4%.
Italy and Germany will see their GDP fall close to 6%, and the UK more than 5%. ( Finland would suffer more)
• If it lasts until the end of July 2020, the average decline in GDP would be close to 8%. And the decrease in GDP could, in some cases, be higher than 10%.
link to material: https://www.ifors.org/wp-content/uploads/2020/04/COVID-19_Supply_Chain_Impacts_Ojala_UPDATE_20200401.pdf
