Global recession not as deep as expected: OECD

Global trade collapsed, declining by over 15 percent in the first half of 2020,. (File/AFP)
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Updated 16 September 2020

Global recession not as deep as expected: OECD

  • The recovery next year will also be more modest than anticipated
  • The extent and timing of the pandemic shock differed across the major economies, but all experienced a sharp contraction in activity

PARIS: The global recession this year will not be as deep as expected as a result of countries’ efforts to counter the economic fallout from the coronavirus pandemic, the OECD said on Wednesday.
But the recovery next year will also be more modest than anticipated, the Organization for Economic Co-operation and Development said, projecting a contraction of 4.5 percent in global economic output this year and a return to growth of roughly 5.0 percent in 2021.
In its previous set of forecasts in June, the Paris-based OECD had been expecting the global economy to shrink by 6.0 percent in 2020 and return to growth of 5.2 percent next year.
“After the initial bounce-back in many activities following the easing of confinement measures, there are some signs from high-frequency indicators and business surveys that the pace of the global recovery has lost momentum since June, particularly in many advanced economies,” the OECD said.
It pointed out, however, that “the economic outlook remains exceptionally uncertain, with the Covid-19 pandemic continuing to exert a substantial toll on economies and societies.”
In the second quarter of 2020, global output more than 10 percent lower than at the end of 2019, “an unprecedented sudden shock in modern times,” the OECD said.
The extent and timing of the pandemic shock differed across the major economies, but all experienced a sharp contraction in activity as necessary containment measures were implemented.

Global trade collapsed, declining by over 15 percent in the first half of 2020, and labor markets were severely disrupted by reductions in working hours, job losses and the enforced shutdown of businesses.
“Without the prompt and effective policy support introduced in all economies to cushion the impact of the shock on household incomes and companies, the contraction in output and employment would have been substantially larger,” it said.
Looking at individual economies, China was expected to be the only one to expand in 2020, with projected growth of 1.8 percent.
India, on the other hand, would see its economy shrink by 10.2 percent.
The United States, the world’s biggest economy, would fare better than the global average, with a projected contraction of 3.8 percent this year.
Germany would perform better than the eurozone as a whole, with its economy set to shrink by 5.4 percent, compared with a contraction of 7.9 percent for the single currency area.
The French economy was set to shrink by 9.5 percent, Italy’s by 10.5 percent and Britain’s by 10.1 percent, the OECD predicted.
Future growth prospects would depend on factors including the severity of new virus outbreaks, the type of restrictions imposed, vaccine deployment and the effects of fiscal and monetary policy actions on demand, the OECD said.

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Apple to launch first online store in India next week

Updated 18 September 2020

Apple to launch first online store in India next week

  • The company at present uses third-party online and offline retailers to sell its products in the country
  • India has become a key focus of tech giants over the last few years

NEW DELHI: Apple announced Friday that it will launch its first online store in India next week, as it seeks to increase sales in one of the world’s fastest-growing smartphone markets.
The company at present uses third-party online and offline retailers to sell its products in the country.
Apple CEO Tim Cook said in a tweet that the company “can’t wait to connect with our customers and expand support in India.”
The Sept. 23 launch comes ahead of India’s major Hindu festival season beginning next month.
With a nearly 1.4 billion people, including millions of new Internet users every month, India has become a key focus of tech giants over the last few years.
In August, three contract manufacturers for Apple iPhones and South Korea’s Samsung applied for large-scale electronics manufacturing rights in India under a $6.5 billion incentive scheme announced by the government.
Apple assembles some smartphones at Foxconn and Wistron’s plants in two southern Indian states.