From January to mid to late March, the world as everyone knew it began shutting down, one country at a time due to the highly contagious coronavirus. When it was deemed a pandemic in March, U.S. companies and local businesses started to shut down, while millions of Americans were forced to either work from home, if they were fortunate enough to keep their job. As families were forced to quarantine inside their homes with limited access to the outside world, lingering questions stemmed to the surface, given the fact that this pushed the world to the brink of a recession.
As a quick response, the U.S. Government was ready to pass its first stimulus package through the CARES Act. This act gave millions a one-time payment of $1,200 plus $500 for each dependent up to three. However, while families seemed grateful during such a critical time, one check wasn't going to be enough for some who have lost their jobs and have families to provide for.
Now, the Americans are anticipating a second stimulus check through the HEROES act, which has been described as a "very generous" one by President Donald Trump. While it has not been formally announced, Trump did confirm that there will be another check coming soon for citizens. The CARES Act created a lot of confusion for some concerning who would qualify and who wouldn't, as well as, it came with a lot of complaints from people receiving their checks super late, or not being sent one at all because they were married to someone without a social security number, to families feeling cheated for not being covered for their child who was 17 or 18 at the time but still considered a dependent.
According to CFR.org, Kristalina Georgieva, managing director of the International Monetary Fund, said, "We anticipate the worst economic fallout since the Great Depression." While U.S. citizens have received one check, with another on the way potentially, not every country government has been put in a position to be so generous to their citizens, according to the publication. So how are other countries taking the massive economic landslide? Below is an overview of how certain parts of the world have managed through an economically destructive time.
It's the world's second largest economy. The coronavirus originated from the city of Wuhan in Hubei Province in late 2019. While it has taken China several months to start re-opening businesses, within the last decade or so, China has doubled its government debt — roughly 60 percent of gross domestic product. Therefore, this has put China in a tight spot when handing out money to citizens.
"The normal monetary policy should be kept as long as possible," Yi Gang, bank chief of China's central bank in April. "The impact of the pandemic is temporary. China's economy has strong resilience and great potential, while the fundamentals for high-quality development won't change." China's central bank has been allowed to loan $80 billion to struggling businesses, with high hopes of getting back on their feet sooner rather than later.prevnext
While Japan is anticipated to shrink their export-driven economy by three percent, which would be the worst performance since 2008, the government still offered up a massive relief package worth almost $1 trillion. On top of that, Prime Minister Shinzo Abe said, "It is no exaggeration to say that Japan's economy, and the world economy, is facing the biggest crisis since [World War II] right now. We will protect employment and life at all costs." In order to help, there are now interest-free loans being offered, delayed tax payments, travel coupons and cash payments.prevnext
The U.K. was hit hard by the impact of the virus considering the British economy was already concerned about a recession prior to the pandemic. There is potential that the pandemic could take out five to 10 percent from its 2020 economy alone, however, the government is prepared to do what it takes to keep citizens safe and sound through the incredibly difficult time. As a result, the Treasury said it will pay 80 percent of workers' salaries for a handful of months to ensure comfort. While this is a great effort to keep from companies losing workers and families losing jobs, they're also going to reimburse self-employed works as well. The U.K. will also provide help to charities aiding those in need of various items and resources.prevnext
Like several other countries, Germany will also see a significant decline in its economy for the 2020 year. Even though half-a-million German companies have applied to have their employees on a government program in hopes of avoiding layoffs, Berlin is stepping in to distribute $350 billion euros. "We're doing whatever is necessary," Chancellor Angela Merkel, who aided in the 2008 crisis said. "And we won't be asking every day what it means for our deficit." Fortunately, Germany is in a good financial position to help its citizens out because the government has managed to reduce its debt-to-GDP ratio by keeping a strict budget in recent years.prevnext
Not long after the bushfire crisis that ran through territories killing off massive amounts of wildlife and ravaging people's homes, Australia was hit with yet another devastating situation. Although the fires seem like a distant memory, despite it taking place in late 2019 early 2020, Australia faces a huge economic loss following the coronavirus pandemic. After only one week towards the beginning of lockdowns, at least one million lost their jobs, forcing Australia to push out their largest economic package yet. Roughly A$130 billion ($80 billion) was given to aid for six million people.
"The wage subsidy idea is Australian in the sense that we've got this tradition of the trade unions and the employers working cooperatively with the government," Tim Harcourt, from the University of New South Wales Business School, told BBC. "They've been working on this almost as a tripartite approach, which brings us back to the Australia of the 1980s and 1990s."prev