Martin Wolf said the present economic crisis is not only just bigger than the Great Depression, but it is also happening at a much faster speed.
Martin Wolf, Chief Economic Editor, Financial Times. (Photo: World Economic Forum)
The world economy is suffering its worst economic crisis since the Great Depression and we are still in its early stages, said Martin Wolf, Chief Economic Editor of the Financial Times.
Martin Wolf was speaking during the India Today E Conclave Corona Series on Thursday.
Speaking about how the current economic crisis triggered by the coronavirus pandemic is different from the great Depression, Martin Wolf said, “It is fundamentally different in its origin, nature and intensity. Its speed surpasses the Great Depression.”
“We are still in the beginning of the collapsed phase of many economies. The overall economic loss will be much greater than any economic crisis that we have seen in the past. The International Monetary Fund has estimated that the global economy will shrink by 3 per cent this year. But this seems to be a very optimistic estimation. The damage will be much greater,” Martin Wolf said.
Asked about the dilemma that many countries are facing whether to end lockdown so that the economy can revive, or to extend the lockdown to contain the spread of the virus, Martin Wolf said this is a “false choice”.
He said the response of each country will depend on their capacity to bear the shock and the living conditions of people.
“The choice is not between containing the virus or rebuilding the economy, the choice should be containing the virus and rebuilding the economy,” Martin Wolf said.
“If we end the lockdown and allow the disease to spread for the sake of rebuilding economy, it will incur a lot of cost. The medical and economic cost will be enormous because people will fall sick. Moreover, people will be reluctant to even come out or buy anything,” he said.
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