Says countries falling into 'deep recession'
South Asia is on it worst course of economic performance in the last 40 years as the novel coronavirus has put its progress in the fight against poverty at risk, the World Bank said on Sunday.
Countries such as India, Pakistan and Bangladesh that are home to more than 1.8 billion people have although shown relatively fewer cases so far, but are potential red zones for the virus.
The dire economic effects are already much in evidence, with widespread lockdowns freezing most normal activity and vast numbers of poor workers suddenly jobless.
“South Asia finds itself in a perfect storm of adverse effects,” a report by the World Bank said. “Tourism has dried up, supply chains have been disrupted, demand for garments has collapsed and consumer and investor sentiments have deteriorated.”
It slashed its growth forecast for the region this year to 1.8% to 2.8% from its pre-pandemic projection of 6.3 percent, with at least half the countries falling into “deep recession”.
The report also warned that the pandemic will reinforce inequality in the region, with the pandemic hitting informal workers with limited or no access to healthcare or social safety the hardest.
Governments need to “ramp up action to curb the health emergency, protect their people, especially the poorest and most vulnerable, and set the stage now for fast economic recovery,” the bank said.
In the short term this means preparing weak healthcare systems, providing safety nets and securing access to food, medical supplies and necessities for the most vulnerable, it advised.
The World Bank is taking “broad, fast action”, deploying up to $160 billion in financial support over the next 15 months to help countries protect the poor and vulnerable, support businesses, and bolster economic recovery.