"We are projecting a somewhat less severe though still deep recession in 2020, relative to our June forecast", said chief economist Gopinath in a foreword to the October revision of the World Economic Outlook.
The IMF chief economist said the foreign debts been acquired by emerging market economies will not be enough and advised that there is a need for continued worldwide support.
This contraction will be the worst recession in 30 years, and the second recession in five years, following closely after a negative economic growth of 1.51 per cent in 2016.
Zhu Min, head of Tsinghua University's National Institute of Financial Research and a former deputy managing director of the International Monetary Fund, said that China is expected to be the only country to have positive GDP growth this year, and for the next two years the country is likely to maintain a growth rate of 10 percent compared with the base in 2019.
For his part, Deputy Minister for Financial Policy and Institutional Development, Ahmed Kojak, said that this report confirms the confidence of the International Monetary Fund experts in the performance of the national economy, while they raised their estimates of the growth rate of the Egyptian economy during the past two years and the current one, adding that the growth rate was negative in the economies of emerging and developing countries. "With low interest rates and high unemployment, boosting public investment-starting with maintenance and ramping up projects-can create jobs and spur economic growth". The IMF now expects the world economy to grow by 5.2% next year, a -0.2 percentage points downgrade from June's forecast.
"The report reflects IMF's confidence in the performance of the Egyptian economy, in a new testimony confirming the insightful vision of President Abdel Fattah El-Sisi, who adopted an ambitious national program for economic reform during the past years in a successful Egyptian experiment that was appreciated by the world", he noted. "It is essential that fiscal and monetary policy support are not prematurely withdrawn, as best possible".
The US economy has been hit hard by coronavirus.
Amid the crisis, euro bond issuance by emerging markets soared to $140 billion in the first half of 2020, up from $95 billion in 2019, according to the report.
Globally, government deficits are set to surge by an average of 9 percent of GDP, while global public debt is projected to approach 100 percent of GDP, a record high, as a result of the ongoing COVID-19 crisis, according to the report.
This support, Gopinath explained, could be in terms of concessionary financing, aid and debt relief and restructuring.
It welcomed a six-month extension of debt payment suspensions that was approved by the G20 on Wednesday, but said more needed to be done for developing countries. Many aid groups are pressing for rich nations to go further and forgive part of the debt rather than just halt repayments. "The ensuing revenues would help pay for critical services, such as health and social safety nets, during a crisis that has disproportionately hurt the poorer segments of society".
The World Bank has warned that up to 150 million more people may be pushed into extreme poverty by 2021. And it would end a period of more than two decades in which the rate of extreme poverty had declined.