Economy: U.S. stimulus package and vaccination should help accelerate growth in 2021
The OECD just released its economic outlook for the year 2021, revised upwards since last November. The return to growth should come sooner than expected thanks to the U.S. stimulus package and vaccination.
The Organization for Economic Co-operation and Development (OECD) unveiled on Tuesday, March 9 its forecast for the return of global growth. According to the OECD, the world’s GDP would grow by 5.6%, whereas the organization estimated growth of 4.2% last November.
This increase in global growth forecasts can be explained, on the one hand, by the massive stimulus plan planned by U.S. President Joe Biden. This stimulus plan alone would contribute an additional 1% to this forecast increase.
According to the OECD, this recovery plan, which amounts to 1,900 billion dollars, would allow, on a global level, to consider a return to the production levels of before the health crisis as early as the middle of 2021, that is to say, six months earlier than initially planned.
For the Americas, the increase is expected to be 6.5%, more than double what the OECD was predicting four months earlier. If these forecasts are confirmed, the United States would experience the fastest economic recovery the country has seen since 1984.
In France, the estimate for economic growth remains almost unchanged, according to the OECD, which expects an increase of 5.9%. In the rest of Europe, growth is expected to reach 5.7% in Spain, 4.1% in Italy and 3% in Germany. China, meanwhile, is expected to rebound by 7.8%, while India is expected to grow even more strongly by 12.6%, while the country is expected to plunge by 7.4% in 2020.
According to Laurence Boone, the OECD’s chief economist, it is essential to accelerate the vaccination campaign in Europe if these forecasts are to be realized. According to OECD calculations, many disparities persist in global immunization. Indeed, the organization estimates that 60% of the Israeli population is vaccinated, while in the United States it is 20%. In parallel, it is around 5% in France and 3% in Brazil.
“We are not saying that Europe is not doing enough in terms of budget, but we are saying that it should speed up on the vaccination front. Because consumers still don’t get out, don’t travel, can’t do things. It’s the health policy combined with the budget policy that really matters,” she says.
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Featured Photo : © Michael Gaida
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