According to the World Bank's June Global Economic Prospects report, global economic growth is expected to reach around 5.6% in 2021, the fastest growth rate in nearly 50 years and the largest post-recession growth in nearly 80 years.
At present, the world economy is in the process of gradual recovery, but it is still fragile and uncertain. In a webinar jointly organized by the Global Think Tank and the World Bank, Ayhan Gause, director of the World Bank's Prospects Group, predicted that global economic growth would remain strong in 2022, but recovery would be uneven. To achieve full recovery of the world economy, we need the concerted efforts of all countries.
Gradual recovery
The whole global economy maintains the momentum of recovery growth at present. According to the China Federation of Logistics and Purchasing, the global manufacturing PMI averaged 56.5 percent in the first half of the year, up 5.3 percentage points from the same period in 2019 and 3.1 percentage points from the second half of 2020. According to the Updated Report on Global Trade released by UNCTAD, global trade in the first quarter of 2021 achieved 10% year-on-year growth and 4% month-on-month growth.
China has played a significant role in promoting world economic recovery. China's gross domestic product (GDP) reached 24.93 trillion yuan in the first quarter, up 18.3 percent year-on-year, according to the National Bureau of Statistics. The international community is also optimistic about China's economic development. The World Bank raised its forecast for China's economic growth in 2021 to 8.5% from 8.1% in a report released on June 29.
"China is the only major economy to maintain positive economic growth in 2020. The active foreign trade conducted by China, especially the active expansion of imports, has injected strong vitality into alleviating the global economic recession and promoting the global economic recovery." Jiang Ruiping, former vice president of China Foreign Affairs University, pointed out in an interview with the Financial Times that "China's economy accounts for a rapidly rising share of the global economy and its economic growth rate is obviously faster than the overall global level, thus making a huge contribution to the global economic recovery. In terms of epidemic prevention and control, China's selfless assistance has also provided important multi-faceted help to alleviate the economic impact of the epidemic in other countries.
In the field of employment, Germany shows a positive trend. Germany's labor market continued to improve in June, with the number of unemployed standing at 2.614 million, 239,000 fewer than the same period last year, according to data released by the Federal Labour Office on June 30. "The Labour market continued to improve across the board in June, with companies reducing short-term work and looking for new workers," said Detlev Scheele, head of the Federal Labour Bureau.
The new coronavirus vaccine has played a role in driving the economic recovery. On 18 June, German Health Minister Jens Spam publicly stated that about 41.5 million people, or 50.1 percent of the German population, had received at least one dose of COVID-19 vaccine; Nearly 24.7 million people, or 29.6 percent of the population, have received two doses of COVID-19 vaccine. "These data give us confidence," he said.
The outbreak drag
What cannot be ignored is that there are still obvious imbalances in the process of world economic recovery.
Developing countries such as the Philippines, Thailand, Indonesia and Malaysia reported negative gross domestic product growth in the first quarter. The World Bank again lowered its forecast for Malaysia's economic growth in 2021 this year.
The recurrence of the epidemic has intensified the uncertainty of economic recovery. India has had its second outbreak since April. India has reported 30 million confirmed cases of COVID-19 and more than 400,000 deaths as of 8 a.m. local time on July 12, according to the latest data from the Ministry of Health.
As a result of the epidemic, India has lost jobs and household income. With more than 15 million people out of work and the unemployment rate rising sharply to 11.9% in May from 7.9% in April, many factories have been forced to cut or shut down production. On June 23, rating agency Moody's cut its forecast for 2021 economic growth to 9.6% from 13.9% previously.
Brazil's economy has also been hit. More than half a million deaths have been reported in Brazil since the outbreak began, according to the Brazilian Ministry of Health. The severe situation of the epidemic has brought challenges to local employment.
The country's unemployment rate stood at 14.7 percent in the first quarter of this year, with 14.805 million people out of work, the highest since the agency began collecting data in 2012, according to data released by the National Geographic Statistics Agency. The lack of a turning point in the epidemic has coincided with a severe drought in Brazil. Recently, Brazil's Economy Minister Jose Luis Guedes announced a three-month extension of emergency aid to the poor.
"The imbalances in global economic development preexisted before the outbreak, and the outbreak exacerbated the problem." Jiang pointed out that the economic recovery is not only divided between countries, but also within countries, the epidemic has further reduced the income level of low-income groups, and the gap between the rich and the poor has increased.
Zhang Yansheng, chief researcher at the China Center for International Economic Exchanges, pointed out in an interview that vaccines are one of the main reasons for the uneven economic recovery.
"Currently, the coverage rate of COVID-19 vaccine in the US, Europe and Japan is relatively high, so the epidemic has been controlled to a certain extent," Zhang said. Against this backdrop, the recovery in the rich economies has been robust. But emerging markets such as India, Brazil and South Africa have low vaccination rates and are not yet out of the COVID-19 epidemic."
"To address the imbalance in global economic recovery, we must first strengthen joint efforts to fight the epidemic and promote international cooperation on vaccines." Zhao Jinping, former director and researcher of the External Economic Research Department of the Development Research Center of the State Council, said in an interview, "We should firmly foster the awareness of a community with a shared future for mankind, and resolutely oppose trade protectionism and investment protectionism. In addition, we should take more active measures to raise market expectations and encourage and promote business investment. We should take how to promote economic recovery as the main policy goal and adopt moderately loose fiscal and monetary policies, "he said.
Looking to the future
The Boao Forum for Asia released its 2021 annual report on Asia's Economic Prospects and Integration Process in March this year. Under the background of the outbreak, the report found that many Asian economies are introduced to promote the new measures of digital economy transformation, covering digital infrastructure construction, industrial development, industrial digital transformation, from multiple aspects, such as digital governance and international cooperation in digital digital economy in advance to return to work and production and economic stability has played an important role, And it will become a new driving force to shape Asia's future economic growth.
In recent days, many member states of the European Union submitted economic recovery plans to the EU and were approved. Germany's federal government has said it plans to spend more than half of EU aid on digitisation and another 40 per cent on climate protection measures. The production of renewable hydrogen energy is also one of the priorities for Germany to increase investment.
Last year, the EU put forward the economic recovery plan and reached agreement on the large-scale economic stimulus plan after the epidemic, with a view to helping member states achieve balanced, inclusive, fair and sustainable economic recovery and promote the green and digital transformation of their economies.
"The future of development must be green development." "At present, countries around the world have basically reached a consensus on laying out the future development path and model from the perspective of tackling global warming," Zhao said. Digital economy is a new field leading the global economy, and has played an important role in further unimpeding and stabilizing the industrial chain and supply chain. In the face of the COVID-19 epidemic, there was a marked decrease in face-to-face communication. This creates a huge demand for digital means of economic activity."
