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The International Monetary Fund warned Wednesday that the economic woes brought on by the coronavirus pandemic could spark an outbreak of protests.
"Some countries remain vulnerable to new protests, particularly if policy actions to mitigate the COVID-19 crisis are perceived as insufficient or as unfairly favoring large corporates rather than people,” the IMF said.
As the number of confirmed coronavirus cases passed two million across the globe, much of the world has been under strict lockdown to contain the spread of the virus.
In its semi-annual Fiscal Monitor report, the IMF said protests are "more likely in countries with histories of widespread corruption, lack of transparency in public policy, and poor service delivery."
While mass protests are unlikely under strict lockdown, unrest could spike once the crisis appears to be under control, Vitor Gaspar, director of the IMF’s fiscal affairs department, told Reuters.
Tensions are already rising in areas where large swaths of the population fall below the poverty line even without a lockdown. In Mumbai, India’s commercial capital, migrant workers protested at a railway station Tuesday demanding to be allowed to return to their homes in the countryside. That day Prime Minister Narendra Modi had expanded the world’s largest lockdown, with India’s 1.3 billion people, until May 3. It originally was set to expire Tuesday.
Meanwhile, governments have spent nearly $8 trillion to mitigate economic fallout and fight the pandemic. Global public debt is expected to rise 13 percentage points in 2020 to nearly 96 percent of gross domestic product. U.S. debt levels are predicted to reach 131 percent of GDP.
The IMF forecasted the global economy to shrink three percent during 2020, but said forecasts were made with “extreme uncertainty” and could be far worse.
IMF chief economist Gita Gopinath said previous disasters and crises had fostered solidarity, but this one could be different.
“If the crisis is badly managed and it’s viewed as having been insufficient to help people, you could end up with social unrest,” she told Reuters.
She said it was imperative that the international community play a supportive role for poorer countries through concessional financing and debt relief.