China, the world’s second-largest economy, is expected to grow 8.5% this year, before slowing to 5.8% in 2022. Asked about the impact of the potential collapse of debt-ridden real estate giant Evergrande, Ms Boone said the agency expects China to deal with any fallout.
And despite a terrible Delta variant outbreak in India this year, the economy is expected to remain largely on track with 9.7% growth, before cooling to 7.9% next year.
In contrast, countries with lower vaccination rates lag significantly behind others, the organization said. In Indonesia, which has vaccinated just 16 percent of the population, the economy is expected to grow by 3.7 percent, one of the slowest rates among OECD countries. Russia, with vaccination rates of around 30 percent, will experience slower-than-expected growth of 2.7 percent.
But robust numbers in the wealthiest economies masked lingering problems, with the recovery benefiting people unevenly.
Growth in the United States has returned to pre-pandemic levels, but employment remains below what it was before the economic restrictions. In Europe, which deployed billions to protect its businesses and workers from mass unemployment and bankruptcy at the height of the crisis, jobs have been largely preserved.
And the virus and lagging vaccination rates continue to hamper the functioning of the global economy, disrupting supply chains, the OECD said.
“Some parts have not left factories in countries affected by virus outbreaks,” Ms. Boone said. As a result, many companies are running out of inventory and slowing production, which in turn drives up prices for a range of products, but the rise is expected to subside once the bottlenecks in the chain dump. supply will diminish.
Inflation will subside faster from current alarming levels if immunization programs accelerate.
“If we continue to vaccinate and better adapt to living with the virus, the supply will start to normalize and that pressure will subside,” Ms. Boone said. “But for that we need to vaccinate more people. “