I would explain the situation of world economy to a 5-year old in the following way:

'When you go to your kindergarten class daily and ask your parents to buy a chocolate for you, then you may notice that they give something in return of the chocolate they get. This is called 'purchasing the chocolate', and the item they give in return of your chocolate is called 'Money'. 

Similarly when you go to classes daily your parents give money in return of the education you are getting at school. Whenever they get anything from outside the house they purchase it in return of the money.

In the same way, the office they work at, gives them money for all the work they do daily.'

Then I would tell him the meaning of economy:

People give or take money in exchange of the services. Since the world is a giant ball of living beings, we all give & take money in some way. This give and take of money creates a flowing 'Economy' in the world...called World Economy.

Everyone and everything is connected with the help of economy. Due to the medical condition prevailing in the world currently the economy has gone down rapidly. All the areas where money is involved have sunken, which means people are not getting paid for anything and thus, they are not purchasing that many things in return.

But slowly and steadily things are changing back to normal. The economy of the world is the most important factor for its growth. 

 If we are able to fight with COVID currently we could bring the economy in proper position like it was before'

This is all that I would explain to a 5-year old about the world economy.