March 07, 2020 "Information
Clearing House" -
New modeling from The Australian National University
looks at seven scenarios of how the COVID-19
outbreak might affect the world's wealth, ranging
from low severity to high severity.
Four of the seven scenarios in the paper examine
the impact of COVID-19 spreading outside China,
ranging from low to high severity. A seventh
scenario examines a global impact in which a mild
pandemic occurs each year indefinitely.
But even in the low-severity model — or best-case
scenario of the seven, which the paper acknowledged
were not definitive — ANU researchers estimate a
global GDP loss of $2.4 trillion, with an estimated
death toll of 15 million. They modeled their
estimates on the
Hong Kong flu pandemic, an outbreak in 1968-1969
that is estimated to have killed about 1 million
In the high-severity model — modeled after the
Spanish flu pandemic, which killed an estimated
17 million to 50 million globally from 1918 to 1920
— the global GDP loss could be as high as $9
trillion. In that model, the death toll is estimated
to surpass 68 million.
"Our scenarios show that even a contained
outbreak could significantly impact the
global economy in the short run," said
Warwick McKibbin, a professor of economics
at ANU who was one of the paper's authors.
"Even in the best-case scenario of a low-severity
impact, the economic fallout is going to be enormous
and countries need to work together to limit the
potential damage as much as possible," he added.
The research aims to help policymakers respond to
the economic impact of COVID-19 as the disease
continues to spread.
"There needs to be vastly more investment in
public health and development, especially in the
poorest countries," McKibbin said. "It is too late
to attempt to close borders once the disease has
taken hold in many other countries and a global
pandemic has started."
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