COVID-19 to hit global GDP by $12 trillion: Zahid Hussain

KARACHI: Chairman of National Business Group of FPCCI, President Pakistan Businessmen and Intellectuals Forum and All Karachi Industrial Alliance, and former provincial minister Mian Zahid Hussain on Friday said global GDP will take a hit of $12 trillion due to the pandemic during 2020-21.

Developed economies will be able to absorb the shock but poor countries are unable to face it as their income has been compromised by the coronavirus, he said. The response of developed nations to the problem is unsatisfactory while that of private creditors is highly unsympathetic, he further said.

Talking to the business community, the veteran business leader said that rich nations have extended the duration of repayments but private creditors are unmoved which can fan poverty and conflicts while destabilising the global economic system.

He said that developed nations have extended repayment of $31 billion of loans but the private creditors of rich nations are not ready to waive loans or extend repayment deadlines. He informed that the major part of the debt of the developing nations has been borrowed from the private sector of the western economies which is not payable in these circumstances.

Poor nations cannot ask the private creditors to reschedule loans as it will hit their credit rating which will result in more problems, he added. The business leader said that the IMF has 2814 metric tonnes of gold worth $175 billion while it has made a profit of 38 billion dollars on the gold due to rising prices.

IMF can consider selling ten percent of the gold stock to provide relief to 73 distressed poor nations which are in the bad need of help, he said.