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The UK is tipped to record the largest leap in growth among advanced economies this year but a resurgent COVID crisis has damaged recoveries globally and resulted in a “dangerous divergence” in economic prospects, according to the International Monetary Fund (IMF).
The world’s lender of last resort used its latest World Economic Outlook report to warn that many emerging market and developing economies faced a “larger setback to improvements in their living standards” – largely a consequence of low COVID-19 vaccination rates.
It forecast that disruption from a “great vaccine divide” and lack of government and central bank support would mean the group – excluding China – would remain 5.5% behind their pre-pandemic growth expectations by 2024.
The Fund said that while the G7 advanced economies would collectively regain that trend by next year, momentum was being hampered by pandemic-linked supply disruptions that were feeding inflation in many countries.
Global growth projections for 2021 were revised down marginally to 5.9% from 6% and unchanged for 2022 at 4.9%.
But chief economist Gita Gopinath said: “This modest headline revision masks large downgrades for some countries.
“The outlook for the low-income developing country group has darkened considerably due to worsening pandemic dynamics.”
She added: “The dangerous divergence in economic prospects across countries remains a major concern.”
Gita Gopinath is the IMF’s chief economist
A key driver was a vaccination rate below 5% in many poor nations compared to 58% for advanced economies where governments have also supported jobs and businesses throughout public health measures to contain the spread of the…
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Source : skynews
