All of the world's largest economies, except the Chinese, will plunge into recession this year due to the coronavirus pandemic, with the euro area's gross domestic product (GDP) falling between 2 and 10 percent, depending on the duration of the 'coronation crisis'. Economic analysts had expected steady growth in the global economy, but the situation has worsened unprecedentedly fast.
In just a few months, as the front pages of the world’s media began to spread news about the spread of coronaviruses in China and the introduction of quarantine in the country, the virus has spread to more than 200 countries, with more than 640,000 infected and 30,000 dead.
To prevent the spread of the virus, many states have restricted travel, closed schools, banned public gatherings, closed restaurants and other services, delayed sports and cultural events. The pandemic has caused major disruptions in supply chains and demand around the world, leading many countries to self-isolation.
This, in turn, has blocked daily operations and pushed the world's largest economies into the first recession since the 2008 financial crisis.
Analysts at Standard & Poor's estimate that the Eurozone economy will fall by at least 2 percent this year, and if the business blockade is extended to four months, the GDP of the 19-member bloc could fall by as much as 10 percent. Almost every business is effected, from real estate to banking and especially tourism and travel.
As economic costs "rapidly increase as virus containment measures intensify, Eurozone and UK economies face a recession and a 2 percent economy decline in 2020," the agency said in a report.
Those countries most affected by coronavirus infections are thought to be most affected. Thus, they estimate that the Italian economy will fall 2.6 percent this year. But Goldman Sachs analysts are much more pessimistic, expecting the Eurozone’s third-largest economy to fall by 11.6 percent.
According to S&P estimates, the Spanish economy could fall 2.1 percent, Germany 1.9 percent and France 1.7 percent.