"If COVID-19 Becomes a 'Pandemic,' Global GDP Will Decrease by 3200 Trillion Won"

Bloomberg Intelligence Analysis of the 'Global Insight' Report

Milan, Italy (Yonhap=Reuters) [Image source=Reuters Yonhap News]

[Asia Economy Reporter Kim Ji-hee] An analysis has emerged suggesting that if the novel coronavirus infection (COVID-19) spreads into a global pandemic, the worldwide gross domestic product (GDP) could decrease by more than 3,000 trillion won.

On the 8th, Bloomberg Intelligence (BI), a research institution under Bloomberg, released its "Global Insights" report estimating that depending on the level of COVID-19 impact, this year's global GDP could decline by between $187 billion (approximately 223 trillion won) and $2.681 trillion (about 3,197 trillion won).

Among the four overall scenarios, the worst-case scenario with the greatest damage occurs if COVID-19 worsens into a pandemic, impacting the entire world and causing global GDP to only begin recovering in the fourth quarter. In this case, the global economic growth rate for this year is expected to be just 0.1%, with the United States, Eurozone, and Japan all experiencing negative growth. Initially, BI had forecasted a 3.1% global economic growth rate for this year.

Conversely, the scenario with the least damage is when COVID-19 causes significant disruption only in China and the economy begins to recover from the second quarter.

However, BI added, "There is still high uncertainty surrounding how the situation will unfold. In an uncontrolled pandemic situation, even the worst-case scenario could be optimistic."