IMF: Economic crisis worse than ’08 financial crisis

The Managing Director (MD) of the International Monetary Fund (IMF), Ms Kristalina Georgieva, has said that COVID-19 has created an economic crisis worse than what the world economy experienced under the global financial crisis in 2008.

“It is way worse than the global financial crisis of 2008-09,” she said during a press conference, jointly addressed with the Director-General (D-G) of the World Health Organization (WHO), Tedros Ghebreyesus, in Washington D.C., today.

She added: “Never in the history of the IMF have we witnessed the world economy come to a standstill.”

Ms Georgieva described the current situation as, “humanity’s darkest hour, a big threat to the whole world and it requires from us to stand tall, be united and protect the most vulnerable of our citizens.”

She said the IMF was working with the World Bank and other international financial institutions to alleviate the economic fallout from the outbreak, which has infected more than one million people in almost every country across the world and killed more than 55,000 people.

The MD said: “Our main preoccupation in this crisis is to rapidly step up financing for countries, especially emerging markets, developing countries that are faced with very significant and growing needs.”

She said that the IMF has a $1 trillion war chest and that her team was determined to use as much of it as necessary to assist countries around the world.

She disclosed that more than 90 countries so far have applied for assistance from those funds.

“We have never seen ever such a growing demand for emergency financing,” Georgieva said.

The WHO boss warned that countries which lift quarantine restrictions designed to contain the coronavirus too quickly risk seeing and even a more severe and prolonged economic downturn.

“We are all aware of the profound social and economic consequences of the pandemic. Ultimately the best way for countries to end restrictions and ease their economic effects is to attack the virus,” he said.