The worst recession in a time of peace in the last century

June 10, 2020


The world economy is entering the worst recession in times of peace in the last one hundred (100) years, according to the Organization for Economic Cooperation and Development (OECD). The agency of the OECD, based in Paris stated on Wednesday 10 June that it expected the global economy to contract by 6% this year before starting to recover in 2021, a prediction that is among the more sombre offered by the multilateral financial institutions. In addition, the agency warned that a second wave of infections by coronavirus would cause even more disruption and scars economic. The World Bank said this week that the world's production declined 5.2% in 2020, while the International Monetary Fund estimated a contraction of 3% in the month of April.
"At the end of[l] 2021, the loss of revenue will exceed that of any recession prior in the last 100 years off the time of war, with dire consequences and durable for people, businesses and governments," said economist and leader of the OECD Laurence Boone. The OECD, which represents the largest economies in the present (G20), said that the damage generated could be even worse if it occurs a second outbreak of the coronavirus in the coming months. That would cause the GDP (Gross Domestic Product) global contract by a 7.6 per cent this year, with effects beginning to diminish in the second half of 2021. If you can determine that the economic outlook is "unusually uncertain", the OECD does not provide for a fast economic recovery, even if it avoids a second wave of infections. Some industries would suffer a reduced activity during a prolonged period of time despite the massive stimulus programs set up by governments, central banks, and the institutions of economic support international. "It is likely that disruption resulting from the pandemic leave lasting scars in many economies. Standards of living are significantly reduced, unemployment is pushing well above the levels considered [above] as pre-crisis, which increases the risk that many people get trapped in periods of unemployment longer, and the investment is falling apart, " the agency said in a report.


With respect to the Plurinational State of Bolivia, the World Bank projected a fall in GDP in 5.9%, due to the COVID-19 in its report “Global Economic Prospects”. The agency has determined that the suspension of the activated that were taken have caused a contraction drastic in the national economy. The report of the World Bank determined that Bolivia is at the fifth place with regard to the withdrawal of economic. In this regard, our neighboring country of Peru, will be one of the countries most damaged by the economic downturn, while projecting a fall of GDP in the 12%. The bolivian economy, in the last few months, had an expansion of only 0.55%, which is the lowest of the last things 19 years.

Rating of Moody's Corporation and Moody's Investors Service

The rating agency Moody's determined the 27 of may of this year that the crisis by COVID-19 will impact severely on the bolivian economy, “promoting the first recession in the country since the 1980s, in addition to the fiscal deficit is expected to double to 6% in 2019 to almost 13% in relation to the Gross Domestic Product (GDP) this year.”