Access to vaccines widens inequalities in economic recovery, IMF says

The recovery should be faster than expected in developed economies, but slower for emerging countries, due in particular to uneven access to coronavirus vaccines, the International Monetary Fund warned yesterday, which maintains its forecast for global growth by 6% in 2021. Lebanon, Syria and Venezuela, however, are excluded from the study, without further explanation, but this is probably due to the difficulty of predicting anything in such uncertain environments.

“Access to vaccines has become the main line of rupture dividing the global recovery into two blocks,” said the IMF in its global economic forecasts updated and published yesterday. On the one hand, most advanced economies, which have access to vaccines and “can expect business to normalize this year”. On the other hand, countries which have little or no access to it “will continue to face a resurgence of infections”. Gross domestic product (GDP) should therefore grow faster than expected in the developed economies, by 5.6% in 2021 (0.5 point more than in the latest forecasts in April). In contrast, emerging markets and developing economies are expected to experience strong growth this year, but slower than previously expected, by 6.3% (-0.4 point). It is India, ravaged by a resurgence of the virus due to the Delta variant, which is experiencing the strongest slowdown in its economic outlook, with growth expected at 9.5% (-3 points). The situation is also deteriorating for China, with expected growth of 8.1% (-0.3 point).

Access to vaccines and budget support

“I would say that we are more worried than we were in April”, even indicated Petya Koeva Brooks, deputy director of the International Monetary Fund (IMF). The emergence of highly contagious variants could cost the global economy $ 4.5 trillion by 2025, warns IMF chief economist Gita Gopinath in a blog post also published yesterday. And “differences in political support are a second source of the widening gap” between countries, she commented.

Thus, the United States should experience growth of 7% this year (+0.6 point) and 4.9% in 2022 (+1.4 point) thanks to massive investment plans in infrastructure and spending. social policies that could soon be adopted in Congress. The IMF stresses that this economic strength should have a positive impact on its trading partners. Ditto in the euro zone, where the “Next Generation” stimulus plan should stimulate growth, now expected at 4.6% in 2021 (+0.2 points). The situation should also be better than expected in the United Kingdom, with GDP up 7% (+1.7 points). In the countries of the Middle East and Central Africa, the international institution is now counting on growth of 4% in 2021 (+0.3 points), and of 2.4% for Saudi Arabia (-0 , 5 points).

The IMF calls on central banks to maintain their support for economies and not to tighten their policies for the moment, believing that “inflation should return to its pre-pandemic levels in most countries in 2022”, despite “the risk that transient pressures may become more persistent ”. The IMF now expects, for developed economies, 2.4% inflation in 2021 (+0.8 point) and 5.4% (+0.5 point) in developing countries. “Inflation is expected to remain high until 2022 in some emerging markets and developing economies, in part due to continued pressure on food prices and currency depreciations, creating a new wedge,” commented the chief. IMF economist. Good news, however, on the international trade front, it should experience growth of 9.7% in 2021 (+1.3 points), “despite short-term supply disruptions”. In the longer term, for 2022, the forecast for global GDP growth is raised by 0.5 points to 4.9%.

Julie CHABANAS / AFP

The recovery should be faster than expected in developed economies, but slower for emerging countries, due in particular to uneven access to coronavirus vaccines, the International Monetary Fund warned yesterday, which maintains its forecast for global growth by 6% in 2021. Lebanon, Syria and Venezuela are however excluded from the study, …

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