JP Morgan: Virus will push emerging economies into recession by mid-year

US, WASHINGTON (ORDO NEWS) — US investment bank JP Morgan warned on Thursday that the disruptive economic impact of the Corona virus would push the world’s poorest countries, except China, into recession by mid-year.

“We now expect a recession in the first half of 2020 in emerging markets, with the exception of China, with enhanced containment and advanced market contraction,” the bank said.

The impact on Latin America (-12 percent), Europe, the Middle East and Africa (-13 percent) is expected to be the largest single-season decline in these regions since 2008-2009 in the coming months.

The breakdown of annual growth on a quarterly basis for Turkey is likely to be 17.2 percent, and Mexico 15.5 percent, the largest among emerging markets in the second quarter, followed by CEE by a narrow margin.

Some of the biggest losses are expected in emerging markets in Europe, the Middle East and Africa, where strict social divergence measures and euro-zone ties are expected to cause permanent losses of three percentage points to this year’s economic output level.

The bank added that it is expected that Latin America, Colombia, Brazil and Mexico will suffer the most damage to their gross domestic product for the year in total, with all of them approaching three percentage points on the basis of comparing the fourth quarter to the same period a year ago.

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