IMF: Pandemic to bring Asia's 2020 growth to halt for 1st time in 60 years

Unlike the global financial crisis triggered by the 2008 collapse of Lehman Brothers, the pandemic was directly hitting the region's service sector by forcing households to stay home and shops to shut down, the IMF said.

The region's export powerhouses were also taking a battering from slumping demand for their goods by key trading partners such as the United States and European countries, it said.

China's economy is expected to grow by 1.2% this year, down from 6% growth in the IMF's January forecast, on weak exports and losses in domestic activity due to social distancing steps.

The world's second-largest economy is expected to see a rebound in activity later this year, with growth to bounce back to 9.2% next year, the IMF said.

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But there were risks even to China's growth outlook as the virus could return and delay normalization, the IMF said.

Asian policymakers must offer targeted support to households and firms hit hardest by the pandemic, the IMF said, calling also for efforts to provide ample liquidity to markets and ease financial stress faced by small and midsize firms.

Emerging economies in the region should tap bilateral and multilateral swap lines, seek financial support from multilateral institutions, and use capital controls as needed to battle any disruptive capital outflows caused by the pandemic, the IMF said