Coronavirus is already impacting global markets, with economic impacts felt beyond China and other affected countries. The effect is visible in every arena of the world economy . Now the situation has reached an unpredictable level   and therefore how extensive its impact on the global economy is yet to be visible in the coming days. Many countries have already locked down either completely or partially and this will  have a long term impact on business and economy.

An unusual  fear is gripping among the nations as they feel that the  economic impact could be significant and will linger for a longer period.

The markets’ movements mirror the uncertainty that prevails and persists not just in the U.S. but all over the world.  As the human toll mounts, so does the economic damage. The business realm, of course, tends to shudder in the face of uncertainty, and right now, with reports on the seriousness of the coronavirus evolving each hour, the situation is slightly out of control. According to a latest UN trade report the global economy will go into recession this year with a predicted loss of trillions of dollars of the world wide income due to Covid -19, spelling serious trouble for developing countries with the likely exception of India and China.

With two-thirds of the world's population living in developing countries facing unprecedented economic damage from the coronavirus crisis, the UN is calling for a USD 2.5 trillion rescue package for these nations. Further  fiscal and foreign exchange constraints are bound to tighten  over the course of the year.

G20 governments have promised a $5 trillion revival effort, major central banks have slashed rates and restarted asset purchases. Lacking the monetary, fiscal and administrative capacity to respond to this crisis, the consequences of a combined health pandemic and a global recession will be catastrophic for many developing countries and halt their progress towards the Sustainable Development Goals. Even as advanced economies are discovering the challenges of dealing with a growing informal workforce, this remains the norm for developing countries, amplifying their difficulties in responding to the crisis. Many hope that the acknowledgement of the need to bolster global financial safety nets and national health systems will translate into action.

By OMNES Editor