AFP, Washington :
The International Monetary Fund called on governments worldwide Monday to join forces and roll out aggressive financial supports for the coronavirus-infected global economy, including direct payments to workers and businesses.
But while several countries have taken steps to cushion the blow to their economies and boost confidence, including the United States, there has been little visible coordination among policymakers like there was at the height of the 2008 global financial crisis.
The rising concern about the global economy has been reflected in the continued collapse of global stock markets, with trillions in value wiped out in recent weeks, a rout that continued Monday. Oil prices have also collapsed.
Given the “acute shocks” caused to economies, consumers and businesses, IMF chief economist Gita Gopinath said “policymakers will need to implement substantial targeted fiscal, monetary and financial market measures to help affected households and businesses.”
That includes “cash transfers, wage subsidies and tax relief” as well as interest rate cuts and financial market support by central banks.
Given the ties between global economies, “the argument for a coordinated, international response is clear,” she said in a blog post.
The IMF already warned that the impact of the COVID-19 outbreak will slow growth in the world economy to below the 2.9 per cent posted last year.
IMF chief Kristalina Georgieva said last week the epidemic “is no longer a regional issue, it is a global problem calling for global response.”
The virus has shuttered factories, disrupted travel, delayed conferences and sporting events and infected more than 110,000 people worldwide. More than 3,800 people have died.
Gopinath said the impact is seen in production cuts hitting companies across the globe that depend on parts from China, where the outbreak originated, but also will hit consumption, since people are reluctant to go out and spend money.
Some countries already have taken steps, Gopinath noted. Italy, the country hardest hit in Europe, “has extended tax deadlines,” and Korea has introduced wage subsidies.
Rome on Monday announced it would lock down the entire country to contain the epidemic as the death toll reached 463.
The International Monetary Fund called on governments worldwide Monday to join forces and roll out aggressive financial supports for the coronavirus-infected global economy, including direct payments to workers and businesses.
But while several countries have taken steps to cushion the blow to their economies and boost confidence, including the United States, there has been little visible coordination among policymakers like there was at the height of the 2008 global financial crisis.
The rising concern about the global economy has been reflected in the continued collapse of global stock markets, with trillions in value wiped out in recent weeks, a rout that continued Monday. Oil prices have also collapsed.
Given the “acute shocks” caused to economies, consumers and businesses, IMF chief economist Gita Gopinath said “policymakers will need to implement substantial targeted fiscal, monetary and financial market measures to help affected households and businesses.”
That includes “cash transfers, wage subsidies and tax relief” as well as interest rate cuts and financial market support by central banks.
Given the ties between global economies, “the argument for a coordinated, international response is clear,” she said in a blog post.
The IMF already warned that the impact of the COVID-19 outbreak will slow growth in the world economy to below the 2.9 per cent posted last year.
IMF chief Kristalina Georgieva said last week the epidemic “is no longer a regional issue, it is a global problem calling for global response.”
The virus has shuttered factories, disrupted travel, delayed conferences and sporting events and infected more than 110,000 people worldwide. More than 3,800 people have died.
Gopinath said the impact is seen in production cuts hitting companies across the globe that depend on parts from China, where the outbreak originated, but also will hit consumption, since people are reluctant to go out and spend money.
Some countries already have taken steps, Gopinath noted. Italy, the country hardest hit in Europe, “has extended tax deadlines,” and Korea has introduced wage subsidies.
Rome on Monday announced it would lock down the entire country to contain the epidemic as the death toll reached 463.
Italy is preparing a 7.5 billion euro ($8.6 billion) package aimed at helping out the devastated tourism industry and other sectors especially hard-hit by disruptions in global supply chains.
