London Daily

Focus on the big picture.
Friday, Oct 02, 2026

IMF calls for bold action on virus

IMF calls for bold action on virus

The International Monetary Fund on Monday called for a coordinated international response to blunt the economic impact of the coronavirus outbreak, while a former chief economist at the World Bank called for the urgent establishment of a global task force to deal with the health crisis.
"Considering the epidemic's broad reach across many countries, the extensive cross-border economic linkages, as well as the large confidence effects impacting economic activity and financial and commodity markets, the argument for a coordinated, international response is clear," IMF chief economist Gita Gopinath said Monday.

The widening coronavirus epidemic has killed at least 3,800 people worldwide.

It has caused both supply and demand shocks, rattled investors and pummeled stock markets, and as seen in recent days, borrowing costs can rise and financial conditions tighten, Gopinath said in a blog post.

"And when these shocks are synchronized across many countries, the effects can be further amplified through international trade and financial linkages, dampening global activity and pushing commodity prices down," she said.

Kristalina Georgieva, chief of the 189-member global lender, last week said the coronavirus outbreak had affected more than a third of the IMF's membership directly. It predicted the global economic growth to be below last year's level of 2.9 percent.

Considering the "particularly acute shocks" in specific sectors, policymakers will need to implement substantial targeted fiscal, monetary and financial market measures to help affected households and businesses, Gopinath noted.

Such measures include cash transfers, wage subsidies, tax relief and unemployment insurance, as well as policy rate cuts by central banks.

China, for example, has temporarily waived social security contributions for businesses, she said in the post.

US President Donald Trump said Monday that his administration will ask Congress to pass payroll tax relief and other quick measures to help reduce the economic impact of a spreading coronavirus outbreak as the number of confirmed cases in the United States hit 700.

"We'll be discussing a possible payroll tax cut or relief, substantial relief, very substantial relief, that's a big number," Trump said at a White House coronavirus task force news conference.

But while several countries have taken steps to cushion the blow to their economies and boost confidence, there has been "little visible coordination" among policymakers like there was at the height of the 2008 global financial crisis, Agence France-Presse reported on Monday.

More than rate cuts, the coronavirus demands a coordinated global policy response, argued Kaushik Basu, former chief Economist of the World Bank.

"The number of daily new cases of the COVID-19 coronavirus are finally declining in China. But the number is increasing in the rest of the world, from South Korea to Iran to Italy," he wrote in an op-ed Sunday.

"However the epidemic unfolds — even if it is soon brought under control globally — it is likely to do much more economic damage than policy makers seem to realize," the professor of economics at Cornell University wrote.

Already, the US Federal Reserve has cut interest rates by half a percentage point – its largest single cut in more than a decade, but the move, without other supporting policies, seemed only to confuse stock markets further; just minutes after the cut, stocks continued their downward slide, Basu noted.

Basu proposed that a multilateral organization such as the World Bank or the IMF should urgently establish a task force comprising 20 economists with diverse specialties, as well as experts in health and geopolitics, to analyze and coordinate actions against the crisis.

The group would need to submit its first report – with a list of initial actions to be taken by governments and, possibly, responsible private corporations – within a month, and provide updates on a monthly basis until effective policies take root, Basu said, adding that it could be disbanded in perhaps a year.
Newsletter

Related Articles

0:00
0:00
Close
Scottish Court to Rule on Bid to Force No-Confidence Vote Against Aberdeen Council Co-Leader
UK Bans Extra Charges for Seating Children Under 12 Beside Accompanying Adults
UK Introduces Vaping Duty and New Licensing Requirements
Greggs to Close Four UK Factories and Cut 740 Jobs
Hundreds of Prisoners Released Early as England and Wales Prisons Reach 98% Capacity
UK Unveils New Russia Sanctions Targeting War Funding and Shadow Fleet
Burnham Says There Are Strong Indications of Iranian Involvement in RAF Fairford Security Breach
Prime Minister Andy Burnham Raises Prospect of Reviewing Britain's Post-Brexit EU Relationship
Markets Price in Bank of England Rate Increases as Inflation Rises to 3.1%
UK Borrowing Costs Climb Toward 5.5% as Global Bond Sell-Off Intensifies
UK-France One-In-One-Out Migration Agreement Expires as London Seeks Alternative Measures
Southwest England Faces Flood Alerts After Heavy Autumn Storms
UK Expands Funding for Rapid Electric Vehicle Charging Infrastructure
Welsh Government Approves Funding to Upgrade South Wales Transport
Northern Ireland Tensions Rise as Orange Order Rejects Drumcree Compromise
NHS Leaders Back Early Design of Proposed National Care Service
More Than One-Third of Regional UK Universities Face Financial Deficits
UK Current Account Deficit Narrows as Cross-Border Financial Flows Remain Strong
Bank of England and FCA Issue New Rules for Stablecoins and Digital Assets
MI5 Warns UK Universities Over Research Links With Chinese Institutions
UK Energy Price Cap Rises 4% as Electricity VAT Is Temporarily Suspended
Equity Calls for UK Personality Rights to Protect Performers From AI Replication
OpenAI Pauses Advanced Model Training Following Safety Concerns
Scottish Government Proposes Replacing 32 Councils With Larger Regional Authorities
Ofgem Raises UK Household Energy Price Cap by 4% From October
UK Counter-Terrorism Police Continue Investigation After Five Arrests Near RAF Fairford
OECD Cuts UK 2027 Growth Forecast to 1%
Labour Says State Pension Triple Lock Remains Protected Through Current Parliament
Andy Burnham Pledges National Care Service With Free Social Care in England
Six Flags Permanently Shuts Landmark X2 Roller Coaster Following Safety Scandals
Metropolitan Police Rule Out Terrorism in Golders Green Stabbing Investigation
Lithium-Ion Battery Identified as Cause of Fatal Merseyside House Fire
UK Department Rejects New Sea Use Framework Due to Stakeholder Fatigue
Major Thames Water Pipe Burst Causes School Closures in London
Aldi Commits £900 Million to Expand UK Supermarket Network
Scottish Affairs Committee Warns Skills Shortages Threaten Defence Sector Expansion
Parliamentary Committee Warns Northern Ireland Budget Deadlock is Stalling Economic Growth
NHS Hospitals in England Face Severe Shortages of Essential Medications
Home Secretary Signals Major Overhaul of UK Immigration and Leave to Remain Policies
Chancellor Promises New Job Schemes Alongside Strict Fiscal Discipline
Energy Secretary Proposes Taxpayer-Funded Green Transition and National Electricity Grid
UK Government to Renationalise Avanti West Coast Railway Franchise in March
Prime Minister Andy Burnham Pledges Major Social Care and Infrastructure Reforms
Five Suspects Released on Bail Following Alleged Bomb Plot Near RAF Fairford
UK Diesel Prices Hit Record High of 199p Per Litre
Transport for Wales and Network Rail Complete Electrification of South Wales Metro
Defra Expands Incentives for Sustainable Farming and Biodiversity in England
Northern Ireland Executive Approves Funding Package to Resolve Public Sector Pay Disputes
Universities UK Warns of Financial Insolvency Risks for Higher Education Institutions
UK Prisons Activate Emergency Protocols to Manage Capacity Pressures
×