A key U.N. trade organization is warning of looming recession in the world economy as countries respond to the novel coronavirus outbreak.

Richard Kozul-Wright of the U.N. Conference on Trade and Development predicts a global “hit” to the world economy of between $1 trillion and $2 trillion this year, and cautions it could be worse.

Even before oil markets plunged Monday, Kozul-Wright said countries whose economies are largely dependent on production of commodities will face pressures as an economic slowdown reduces demand for their products.

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Kozul-Wright said the European Union, which faced poor economic prospects at the end of 2019, was “almost certain” to tumble into recession this year, pointing especially to pressures in Germany and Italy.

He was speaking at a release of a new UNCTAD report examining the possible impact of the COVID-19 outbreak and forecasting that annual global growth will fall below 2.5% this year.

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