The UN economic forecast, published on Tuesday, stated that while the outlook for global growth has improved, the ongoing impacts of the pandemic, as well as inadequate progress on vaccination in poorer countries, are putting recovery at risk.
The World Economic Situation and Prospects (WESP) mid-year report warned that widening inequality is threatening global growth, projected at 5.4 per cent in 2021.
“Vaccine inequity between countries and regions is posing a significant risk to an already uneven and fragile global recovery.
“Timely and universal access to COVID-19 vaccinations will mean the difference between ending the pandemic promptly.
“It will place the world economy on the trajectory of a resilient recovery, or losing many more years of growth, development and opportunities,” it stated.
The mid-year forecast updates the WESP report published in January by the UN Department of Economic and Social Affairs (DESA).
It examines the performance of the world economy since the pandemic began, as well as the impact of global policy responses and post-crisis recovery scenarios.
The 5.4 per cent in projected global growth this year follows a sharp contraction of 3.6 per cent in 2020, and reflects an upward revision from the original forecast.
While the world’s two largest economies – China and the United States – are on the road to recovery, growth remains fragile and uncertain in several countries in South Asia, sub-Saharan Africa, and Latin America and the Caribbean.
Many countries will not see economic output return to pre-pandemic levels until 2022 or 2023.
“For a vast majority of developing countries, economic output will remain below 2019 levels for most of 2021.
“Amid insufficient fiscal space to stimulate demand, many of these countries will face low and stagnant growth and the prospect of a lost decade,” the authors said
The report also details strong but uneven recovery in global trade, which has already surpassed pre-pandemic levels due to demand for electrical and electronic equipment, personal protective equipment, and other manufactured goods.
Economies which depend on manufacturing have fared better, however, countries which rely on tourism or commodities are unlikely to see a quick rebound.
Tourism services in particular will remain depressed due to slow lifting of restrictions on international travels, coupled with fears of new waves of COVID-19 infection.
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