The swift and decisive response against COVID-19 successfully contained the virus outbreak, saving lives and allowing the economy to reopen faster. However, confinement brought a number of sectors to a sudden stop in the second quarter. The economic recovery will be supported by substantial fiscal and monetary stimulus, but will remain sluggish, as high unemployment and weak business confidence hold back domestic demand and export growth is stymied by the collapse of international tourism. Assuming that there are no further virus outbreaks (the single-hit scenario), GDP is projected to shrink by nearly 9% in 2020 and only return to the pre-crisis level by the end of 2021. Should there be a second global wave of infections in the fourth quarter of 2020 (the double-hit scenario), GDP is projected to shrink by 10% in 2020 and to remain 3.5% below the pre-crisis level by the end of 2021.