From Isaac Anumihe, Abuja
One year into the COVID-19 pandemic, International Monetary Fund (IMF) has predicted a global economic growth of 6 per cent in 2021, moderating to 4.4 per cent in 2022.
In the latest economic outlook, the Fund also predicted an uncertain year following the new virus strains. “Global prospects remain highly uncertain, one year into the pandemic. New virus mutations and the accumulating human toll raise concerns, even as growing vaccine coverage lifts sentiment. Economic recoveries are diverging across countries and sectors, reflecting variation in pandemic-induced disruptions and the extent of policy support. The outlook depends not just on the outcome of the battle between the virus and vaccines, it also hinges on how effectively economic policies deployed under high uncertainty can limit lasting damage from this unprecedented crisis” it said.
IMF noted that although the global economy would grow at 6 per cent, the projections for 2021 and 2022 are stronger than in the October 2020 World Economic Outlook (WEO).
“Global growth is projected at 6 percent in 2021, moderating to 4.4 percent in 2022. The projections for 2021 and 2022 are stronger than in the October 2020 WEO. The upward revision reflects additional fiscal support in a few large economies, the anticipated vaccine-powered recovery in the second half of 2021, and continued adaptation of economic activity to subdued mobility. High uncertainty surrounds this outlook, related to the path of the pandemic, the effectiveness of policy support to provide a bridge to vaccine-powered normalisation, and the evolution of financial conditions.
“Although the contraction of activity in 2020 was unprecedented in living memory, extraordinary policy support prevented even worse economic outcomes. One year into the COVID-19 pandemic, a way out of this health and economic crisis is increasingly visible, but prospects remain highly uncertain. The strength of the recovery will depend in no small measure on a rapid rollout of effective vaccines worldwide. Much remains to be done to beat back the pandemic and avoid persistent increases in inequality within countries and divergence in income per capita across economies” the statement, further explained.
Early this year, the Fund had projected global growth for 2021 to be 5.5 per cent and growth was expected to moderate to 4.2 per cent in 2022.