Coronavirus Disease (COVID-19) Crisis: Is Crisis driving world towards Recession?

Coronavirus disease pandemic (COVID-19) crisis symptoms, remind that's not disease symptoms, crisis symptoms driving world towards economic recession.

 Mr.Antonio Gutters, Secretary- General of  UNO stated coronavirus crisis is a worst crisis since world war-2. This crisis gives a challenge of lives vs livelihood, one side there is a big number of deaths all over the world, on the other hand world economic recession. To know how far worst the current crisis, let us try to understand by these points:

• World Economy
• Role of International Organizations
• Current Scenario of the world Economy.
• Steps to be taken as per Economy Experts.

What about the world Economy?
1/3rd of the world is under lock down and around 70% of the economy is in sleep mode. Coronavirus disease (COVID-19) pandemic eradication takes time, now coming to the worry about economic recession, few sectors are working in this crisis are,

• Work from home: These sectors of economy has not not effected by COVID-19 crisis, even in the lock down situation there is no disturbance for these. Example: IT industries, few online services etc.
• Digital Economy: software, telecom,Networking etc.
• Essential services: Medical, pharma, sanitary, water,Electricity, Transport of essential goods, Ambulance etc.

Except the above sectors remaining economy the world is not working, there is chance of Economic recession, food insecurity, decrease in income of common people.To understand world economy i.e: 50% of the world economy collectively by USA,China,EU.
By March,2020 observations GDP share of world economy, Top GDP Countries are

1. US (23.6% of world's GDP)
2. China (15.5% of World' GDP)
3. Japan (5.67% of World's GDP)
4. Germany (4.25% of World's GDP)
5. India (3.23% of World's GDP)

More than 50% of GDP in world economy comes under the above 5 Countries suffer from crisis now. World Economy refers not only the above 5 countries but  here the question is, Even the top 5 GDP share countries of the world can't fight against crisis then what about the remaining?
For these international organisations has to play crucial role to come out from the recession.
What is the Role and Response of International Organisations?
G20,WTO,IMF,WB and WEF

G20:
Group of 19 countries & European Union which contributes 85% of the world Economy and 2/3 of the world population.

In the recent summit  "An Economic Emergency Council" for Presidents and Prime Ministers the following decisions has taken:

• Established World Premier Economic Crisis Management Organisation.
• Injected $5 trillion to combat COVID-19 crisis.
• Agreement on supply of essential medicines and medical facilities among the member countries.
• Agreement on cooperation of Agricultural sector,products and in the supply of food grains.
• Strengthen World Health Organisation (WHO) and its activities during this pandemic situation.

WTO(World Trade Organization):

• 164 countries as members and Trade negotiations, settling trade disputes, maintain trade flow among members as functions.
• Recently stated that world trade expected to fall by between 13%-32% in 2020, this indicates that COVID-19 pandemic disrupt the normal economic facilities and lives.
• Every country will suffer by double digit declines in 2020.
• Exports from Asia and North America effects more.

IMF(International Monetary Fund):

•  Functions: International trade, secure financial stability,sustainable economic growth, increasing employment, poverty reduction for all 189 member countries.
• Managing Director Kristalina Georgieva gave priorities for global economy, the Secured lending capacity of serve member countries as $1 trillion.
• Quick response to an unprecedented emergency financing requests from 90 countries so far.

WB (world Bank):

• 189 countries and functions comprises of IDA (International Development Association), IBRD (International Bank for Reconstruction and Development), IFC (International Finance Corporation), ICSID (International Centre for Investment Disputes), MIGA (Multilateral Investor Settlement and Guarantee Agency)
• 160 billion dollars over next 15months as a broader program.

WEF (World Economic Forum):

• Said that Cooperation needed among governments, international organisations and business communities, as countries with great recession can't fight alone.

 What is the current scenario of world Economy?

• Global Supply Chain Disruption all over the world leads to decrease in production, increase in unemployment, decrease in individual income, can't buy essential needs, decrease in demand. Again cycle starts decrease in production. According economy terminology this cycle is called economic cycle. Vicious Cycle (vs) Virtuous Cycle.

• Unemployment in Informal Economy increases, based on"Government Respond Stringency Index"  by university of Oxford, ILO (International Labor Organization) declared 200crores of labor thrown into unemployment from unorganized sector who are working in informal economy. 20% of this 200 crores i.e 40 crores of unorganized labor from India alone.

• UNO: As per recent update of United Nations Organization, world economy going to recession, except China and India. Internal market, man power, geographical advantages all these reasons may cause to survive from recession in countries like India and China. As per  India's demographics 40% of Indians i.e 62 crore (620million) are 20-40 year old. Decreases institutional Credit availability, means banks will not ready to sanction loans for unorganized labor leads to poverty and number of people under BPL increases.

Steps to be taken by Government:

• Employment retention schemes should be implemented by Govt.
• Unemployment allowances needed, employment intense sector should be developed in order to protect wages for and to maintain statutory minimum income of the common man.
• Inflation control measures should be taken.
• It's better to concentrate on sectors of mass consumption of goods and service sector.

Final word:

• Every crisis gives an opportunity, Over night growth is impossible. There is no magic pill to boost up the economy. Contribution of economic experts, committees on various sectors needed for every country.