IMF warns of potential global economic decline resulting from Omicron

Containers stacked at the Port of Los Angeles on the day US Secretary of Labor Marty Walsh spoke on initiatives to mitigate supply chain disruptions, November 30, 2021 in San Pedro, California. (Photo: AFP)
AMMAN — On Friday, the International Monetary Fund’s (IMF) Managing Director Kristalina Georgieva predicted a global economic decline due to the impact of the Omicron coronavirus variant, according to media reports.اضافة اعلان

More specifically, she said the global economy is expected to grow at a rate of 5.9 percent this year, but slide next year, to reach 4.9 percent.

Georgieva said that inflation is increasingly likely to occur globally, but the measures to address it will depend on individual countries.

Shorouq Hilal, acting head of social media at the Ministry of Digital Economy and Entrepreneurship, told Jordan News that the ministry is aware of certain predictions by financial experts and banks about a global decline in the economic growth and that while the ministry is “aware that some countries have resorted to lockdowns as a result of Omicron”, “the best Jordan can do now is to be optimistic that the Omicron’s biological and economic impact will not be very drastic”.

Key to attempting to contain the repercussions is “paying attention to upcoming updates from financial experts”, she said.

Hilal said that the riskiest measure against Omicron, from an economy point of view, would be having yet another round of lockdowns throughout the Kingdom, particularly knowing that the lockdowns during the first and second waves took a heavy toll on people and economy.

For example, “several small business owners had to close their businesses which operated successfully for years” and some public sector workers had to settle for receiving half of their original wage, due to economic decline, she said.

There is, however, no evidence that suggests Jordan will go down the lockdown route any time soon.

Most vulnerable to the effects of a return to national lockdown are “those who rely on daily wages”, she said, adding that this group would find it even more difficult to have to repay bank loans if the economic impact of a potential Omicron spread turns out to be hard hitting.

Limiting gatherings in public spaces by checking the vaccination status upon entry is a measure that Hilal supports and finds “necessary”, especially since it “will not cause dire economic consequences”.

“When everyone starts to care about other people the same way they do about their own interests, the safety of the people will be ensured” and with it, the economic interests.

Ministry of Labor spokesperson Mohammad Zyoud said that as a result of the economic repercussions of COVID-19, the ministry has been collaborating with governorate leaders in matters related to employment. As a result, job opportunities in the productive sector have been created in the most impoverished areas in the Kingdom, “especially those with the highest rates of unemployment”.

“These job opportunities mostly involve work in clothing and textile industry, which is particularly suited for Jordanian women seeking work during the pandemic,” he said.

Zyoud also said that the “ministry has been coordinating with the Development and Employment Fund since the beginning of the crisis to reschedule loan payments for citizens who have been financially impacted by the pandemic” to relieve some of the economic pressure they are under.

“With or without Omicron, as a nation, we are still feeling the economic impact of the initial outbreak, but I am confident in the government’s capacity to resolve issues relating to Jordan’s economic growth,” he said.

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