By Ndubuisi Francis
The Organisation for Economic Cooperation and Development (OECD) has revealed that global gross domestic product (GDP) could recover to pre-pandemic levels as early as 2021.
OECD is an international organisation which works to build better policies for better lives, and shapes policies that foster prosperity, equality, opportunity and well-being for all.
All things considered, the OECD projects global GDP to fall by 4.5 per cent this year before growing 5 per cent in 2021.
In its just-released interim Economic Outlook, providing an updated look at the COVID-19 pandemic’s effect on the world economy, the OECD warned that resilient and sustainable growth will depend on a number of factors.
These include business confidence, how well health measures are observed and the likelihood of new outbreaks.
Striking a slightly more positive tone than the previous edition published in June, the report finds that “economic output recovered swiftly following the easing of measures to contain the COVID-19 pandemic and the initial re-opening of businesses”.
However, it also notes that the “pace of recovery has lost momentum over the summer,” adding that restoring confidence will be key to successful economic recovery.
The OECD expects all G20 countries except China to fall into recession this year, with a swift but fragile recovery projected for 2021.
It also expects global GDP to return to its pre-pandemic level by Q3 2021. However, economic output is expected to remain below late-2019 levels in many countries, not to mention the levels projected before the advent of the pandemic.
The report also notes that uncertainty remains high and that the strength of the recovery depends on numerous variables, resulting in an upside and a downside scenario.
The report said: “Prospects for an inclusive, resilient and sustainable economic growth will depend on a range of factors.
“These include the likelihood of new outbreaks of the virus, how well individuals observe health measures and restrictions, consumer and business confidence, and the extent to which government support to maintain jobs and help businesses succeed in boosting demand.”