More specifically, the advanced economies are forecast to grow 5.8% this year. This would more than compensate for the cumulative decline in gross domestic product (GDP) in 2020, stressed Atradius.
“Some of the uncertainty that hung over the market last year has disappeared,” said a statement from the insurer. “In the United States, President Joe Biden is expected to pursue more rigorous policies than his predecessor. In addition, the Biden government has implemented several fiscal stimulus laws that are boosting GDP growth in the US and elsewhere.
“The outlook for the UK is also significantly better than it was at the beginning of 2020. Consumers are driving the recovery in the UK with strong growth in the hospitality sector, although trade growth with the EU (European Union) is lagging due to Brexit.” And pandemic Uncertainties. “
However, Atradius projections assume that governments will be able to effectively contain new outbreaks of the coronavirus. The more transferable Delta variant could potentially bring the global recovery to a standstill.
“If vaccines against new virus variants like Delta are less effective than expected, governments may have to impose restrictions later this year,” said the credit insurance specialist. “This creates a downside risk to positive forecasts and would reduce consumption opportunities and curb GDP growth in 2021 and 2022.”
Chief economist John Lorié admitted that following the path of the pandemic will be a challenge.
The Atradius manager added, “The recovery prospects look good given rising consumer demand and fiscal stimulus, but rising inflation suggests that there are supply-side issues that need to be addressed. While we expect inflation to return to normal levels in 2022, high inflation remains a downside risk, especially if it triggers a forced monetary tightening that would hamper the recovery. ”