Private sector companies have faced a triple shock
In addition to an alarming degree of volatility. Second, on the supply side, the closure of many industries and restricted access to human resources and other inputs have resulted in lockdowns and limits on human mobility. Second, the falling wages on the demand side have limited consumption to the necessary basic needs. Third, a financial shock has misstruck several businesses that have not been funded by banks or have not gained from government funding.
In order to track the impact of COVID-19 on the socio-economic conditions of Mauritian households over the period May-July 2020, Mauritius, the national statistical agency of the region, and the World Bank have launched a series of three high-frequency telephone household surveys. The World Bank supports funding for data collection and technical assistance in support of the surveys.
The surveys collect crucial national-level information on access to essential goods and services, food poverty, shifts in household wages, shocks and coping methods, and economic development among all household members aged 16 to 64 years who are not in full-time school either by self-reporting or by proxy.
When several persons were unable to go to work and firms could no longer function, the pandemic and mitigation efforts led to a drastic reduction in economic development. Around February and April 2020, industrial production decreased by an average of about 28 percent in the G20 countries in just two months. India, Indonesia, Italy, and South Africa reported more significant declines between 40 and 60 percent, and Korea and Russia recorded comparatively small decreases. The data show that the trough's activity occurred in all countries except China in April, where it appeared in February.
The strength of the rebound, looking forward, remains somewhat unpredictable. It would partially depend on whether it is possible to prevent a second wave of coronavirus infections before an appropriate cure or vaccine becomes available. The OECD Economic Outlook (2020), released on 10 June, reflected this complexity and proposed forecasts focused on two similarly possible scenarios. A second wave is stopped in the first "single-hit" scenario, not in the "double-hit" scenario. In all cases, 5.8 percent and 7.3 percent of the G20 economies are expected to contract significantly in 2020.
Growth is expected to recover by 5.5 percent in 2021 under the single-hit scenario, leaving real GDP for the G20 economy as a whole just below the amount achieved in the last quarter of 2019. The recovery would be lower at only 3.1 percent in the double-hit case, leaving a much more significant difference in actual GDP from its pre-crisis stage. Compared to the expected pre-crisis growth in GDP for 2020 and 2021, the difference is much more meaningful. This gap is larger for the G20 developing market economies than for the G20 advanced economies.