A risk outlook by top professionals has forecast a long-drawn downturn of the global economy and joblessness as the biggest consequences of Covid-19.
More than 300 international risk professionals, who were asked by the World Economic Forum to look at the next 18 months, believe that global economic distress in the form of a prolonged recession and high unemployment, especially among the youth, could be followed by a surge in bankruptcies of big as well as small and medium enterprises.
Some of the industries and sectors in some countries might not recover in the next one-and-a-half years, warns the WEF report titled “The COVID-19 Risks Outlook: A Preliminary Mapping and Its Implications”.
The report identifies seven economic, one geo-political, one tech and one societal fallout from the pandemic.
A high level of structural unemployment, weakening of fiscal positions of major economies, long-lasting disruptions of global supply chains and possible economic collapse of an emerging or developing country are other top-ranked fallouts in the report.
The risk outlook also suggests that cyber-attacks and data frauds due to a sustained shift in work pattern in a post-Covid world are also likely.
Tighter restrictions during cross-border movements of persons as well as goods are also a common outcome of the pandemic identified in the report.
A possibility of another outbreak of Covid-19 or any other similar pandemic in the near future is featured among the top ten fallout list.
A prolonged global recession came up as a top concern for businesses. But more than that, cybersecurity and data fraud emerged as a greater worry for the businesses.
Besides, the experts expressed concerns over a potential increase in global inflation in the aftermath of the outbreak.
Experts worry that the effects of the coronavirus pandemic on societies are going to last long.
“The pandemic will have long-lasting effects, as high unemployment affects consumer confidence, inequality and well-being, and challenges the efficacy of social protection systems. Decisions taken now will determine how these risks or opportunities play out,” said Peter Giger, Chief Risk Officer at the Zurich Insurance Group.
Some, however, feel it may well be the time to see opportunity amidst a grave crisis.
“The crisis has devastated lives and livelihoods. We now have a unique opportunity to use this crisis to do things differently and build back better economies that are more sustainable, resilient and inclusive,” said Saadia Zahidi, Managing Director of the WEF.
According to the WEF, societies using the crisis to make recoveries through climate-sensitive and sustainable initiatives can emerge stronger if the right steps are taken now.
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