Global economic forecast raised to 5.4%, says UN

The United Nations (UN) on Tuesday revised its global economic forecast upward to 5.4 per cent growth for 2021, but it warned that surging Covid cases and inadequate availability of vaccines in many countries threaten a broad-based recovery. In raising its projection from January of 4.7 per cent growth, it pointed to the rapid vaccine roll-out in a few large economies.

The United Nations (UN) on Tuesday responded to the rebounding Chinese and US economies by revising its global economic forecast upward to 5.4 per cent growth for 2021, but it warned that surging Covid cases and inadequate availability of vaccines in many countries threaten a broad-based recovery.

In raising its projection from January of 4.7 per cent growth, the UN’S mid-2021 World Economic Situation and Prospects report pointed to the rapid vaccine roll-out in a few large economies led by the US and China and an increase in global trade in merchandise and manufactured goods that has already reached its prepandemic level.

But the UN cautioned that “this will unlikely be sufficient to lift the rest of the world's economies,” and “the economic outlook for the countries in South Asia, subsaharan Africa and Latin America and the Caribbean remains fragile and uncertain.” Lead author Hamid Rashid, chief of the Global Economic Monitoring Branch in the U.N. Department of Economic and Social Affairs, told a news conference that “Europe's outlook is not as bright as we expected” because of signs of second and third waves of Covid-19 infections.

“The key challenge we face in the world right now is that infections are still rising in many parts of the world, and we are seeing new variants and new mutations affecting large populations in South Asia, also in Latin America,” he said.

“That poses a significant challenge in terms of the recovery and world economic growth.” Rashid said: “Vaccination is probably right now the number one issue to put the world economy on a steady path of recovery.” He noted, however, that “vaccine inequity is a serious challenge.”