Visitors leave the Nanning International Congress and Exhibition Center during the 17th China-ASEAN Exhibition on November 30, 2020 in Nanning, Guangxi Zhuang Autonomous Region of China. (Photo by Peng Huan / VCG via Getty Images)
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“For the first time since the pandemic began, there is now hope for a brighter future,” the OECD said on Tuesday, citing progress with coronavirus vaccines and unprecedented government and global banking action to mitigate the economic impact of the crisis.
“The worst is avoided, most of the economic structure is preserved and can be revived quickly, but the situation remains precarious for many vulnerable people, companies and countries.”
In its latest economic outlook, the OECD said it expects the global economy to shrink by 4.2% this year. This reflects an upward revision from an estimate made in September, which showed a decline of 4.5% in real GDP.
In perspective, the group said global economic growth would average 4% over the next two years. He expects real GDP growth to reach 4.2% in 2021 – reduced from the September forecast of 5% – and 3.7% in 2022.
He warned that “significant” uncertainty remained, and called on politicians around the world to maintain targeted support for vulnerable children, people and businesses to reduce the risk of a “scarring” coronavirus crisis.
Fiscal relief “to pay solidly”
The OECD, which monitors and advises its 37 member countries on economic policy, has expressed cautious optimism about the growing global economy by 2022.
He cites scientific advances, pharmaceutical advances and corrections in the behavior of people and companies, among others, as factors that can help keep the virus under control, allowing for the gradual removal of severe restrictions on mobility.
Along with the reduced uncertainty and the exceptional fiscal relief provided in 2020, which the OECD expects to “pay off extremely well”, the global economic leap is expected to continue to intensify as more and more activities reopen.
CSL staff will work in the laboratory on November 8, 2020 in Melbourne, Australia, where production of the COVID-19 vaccine from AstraZeneca-Oxford University will begin.
Darian Traynor Getty Images
In recent weeks, several encouraging developments have been announced in the race to deliver a safe and effective coronavirus vaccine, raising hopes that the world will soon be able to return to some semblance of normalcy.
We hope that coronavirus vaccines will help end the pandemic that destroyed part of the world economy and claimed more than 1.46 million lives worldwide.
China to stimulate global recovery
The OECD said the economic recovery would be uneven between countries, but “would potentially lead to lasting changes in the world economy”.
According to him, China is expected to account for more than a third of global economic growth in 2021, while the contribution of Europe and North America “will remain less than their weight in the global economy.”
The OECD said it saw China, which had begun to recover earlier than its peers, show 1.8 percent economic growth this year. It remains the only major economy expected to see economic growth in 2020.
The second largest economy in the world is expected to report real GDP growth of 8% next year and 4.9% in 2022.
In comparison, the United States is expected to record an economic decline of 3.7% in 2020, before reporting growth of 3.2% in 2021 and 3.5% in 2022.
For the euro area this year, GDP was reported at -7.5%, 3.6% in 2021 and 3.3% in 2022.
“Despite the huge political aid tape and even in the opposite scenario, the pandemic will damage the socio-economic structure of countries around the world,” the OECD report said.
“People living in poverty and usually less covered by social safety nets have seen their situation worsen. Children and young people from less disadvantaged backgrounds and less skilled older workers are struggling to learn and work from at home, with potential long-term damage. “
The OECD has said that governments will need to use their policy instruments to ensure that those most affected by the coronavirus crisis receive the support they need.