SPAIN will be the worst hit first world country, economically, due to the coronavirus crisis, the IMF has said.
New figures released by the International Monetary Fund suggest that Spain’s economy is projected to shrink by 12.8% this year.
This will be the biggest decline since the Spanish Civil War of 1936-9, when it reached 26.8%.
No other country’s economy in the developed world is projected to shrink more than Spain’s, with Italy also on 12.8% followed by France with a drop of 12.5%.
Spain’s anticipated output for the remainder of the year is now 5% lower than the IMF was predicting in April.
In addition, the Bank of Spain earlier this month estimated that the economy will shrink by up to 15% this year, 2% higher than its prediction in April when it was 13%.
At the same time however, the rebound projected in 2021 is higher than the one predicted in April, with 6.3% compared to 4.3% that it was two months ago.
Yesterday the IMF released its latest World Economic Outlook (WEO) update: “The COVID-19 pandemic has had a more negative impact on activity in the first half of 2020 than anticipated, and the recovery is projected to be more gradual than previously forecast.”
Pedro Sanchez also alluded to this yesterday saying that ‘the economic forecasts are predicting a dark horizon.’
“As with the April 2020 WEO projections, there is a higher than usual degree of uncertainty around this forecast,” added the IMF.
Globally the economy is predicted to shrink on average by 4.9% in 2020, while in the eurozone that prediction is 10.2%.
Spain in both cases is higher than the average, registering a bigger drop even compared to the 2008 financial crisis.
Part of the reason why the Spanish economy is expected to suffer so intensely is due to the fact that the lockdown in the Iberian country was much stricter than elsewhere.
This comes as Spain’s public debt shot up by €22.5 billion in March alone.