Brussels (Brussels Morning) The Organisation for Economic Cooperation and Development (OECD) published its Interim Economic Outlook report on Tuesday, forecasting a faster than expected recovery of the global economy, though Europe’s recovery rate seems in danger of falling below the world average.
According to the forecast, global GDP is set to grow 5.6% in 2021, compared to the earlier prediction of a 4.2% growth made in December. The new figure is boosted by two major developments – the deployment of coronavirus vaccines and the 1.9-trillion dollars economic stimulus passed by US lawmakers.
Consequently, the expected US growth figure was revised from 3.3% to 6.5%, accounting for much of the global economic boost. The Chinese economy is also set on the road to fast recovery, with its growth figure revised from a 0.2% slump to a whopping 7.8% increase. India is expected to record double-figure growth in 2021, since OECD revised its growth rate from 4.7% to 12.6%.
Europe, in contrast, is likely to remain below the curve, with the Euro area forecast expecting growth of 3.9%. Even though this is much higher than the previously predicted 0.3% growth, the figure remains well below the global average, and is far behind that of China and the US. At 5.9%, France’s economy is forecast to grow slightly faster than the world average, while German growth is expected to reach 3.0 % in 2021.
The OECD now expects the global economic output to surpass pre-pandemic levels by the middle of the current year. It notes, however, that some regions may continue struggling until the end of 2022.
The pandemic has contributed also to the growth of unemployment, with some 10 million more unemployed registered among OECD member countries than before the coronavirus outbreak. OECD also warned that substantial job losses to date have increased poverty and the deprivation of millions of workers in poorer countries.