World economy faces fast but uneven recovery – leading macroeconomic influencers

The World Bank is calling for wider distribution of Covid-19 vaccines to low-income economies, pointing out that policy makers must address the ongoing effects of the pandemic and take urgent steps towards a green, inclusive and resilient recovery.

John Ashcroft

John Ashcroft, a lawyer and former Missouri governor and attorney general for the Bush administration, shared an article about the World Bank’s predictions of the world economy targeting the fastest recession in 80 years.

However, the institution also believes that the slow distribution and access to Covid-19 vaccines in low-income countries will further widen the gap between rich and poor countries.

As a result, the institute said the world economy will grow by 5.6% in 2021, compared to previous estimates of 4.1%. It also claimed that this rapid recovery from the Covid recession is being driven by growth in some major economies that have made rapid advances on vaccinations, leading to reopening in all sectors of the economy.

However, the bank has sent out warning signs of uneven recovery, suggesting that only a third of low-income countries compared to 90% of richer countries will be able to return to their resumed GDP levels.

Gregor Ip

Greg Ip, chief commentator on economics for the Wall Street Journal, shared an article about the US currently experiencing a productivity boom, but job prospects are not all that good as employers conclude that their sales are being made with fewer new hires. The Covid-19 pandemic and labor shortage have driven companies to change their business models and step up the use of technology to generate more revenue with the same workforce, maintain GDP and wages while employment remains behind.

Experts say industries such as retail, finance, construction, information, and professional and corporate services, which have accounted for nearly a third of the US job losses since the pandemic began, have increased their output.

Unlike normal recessions, where productivity rises first and then rises again with hiring, the Covid downturn has revealed unusual patterns that are remote and technology dependent. Experts believe that the ongoing labor shortage will put wages under pressure, force companies to digitize faster and take longer for employment to recover.

Kate Raworth

Kate Raworth, an economist at the University of Oxford and the University of Cambridge, shared an article on the need for the G7 countries to commit to shift their fossil fuel funding in 2021. You and other economists believe that G7 leaders should not stop just coal but also oil and gas financing this year to meet the Paris Agreement climate goals and a green pandemic economic recovery.

Economists believe the time has come for G7 members to invest in clean energy to address climate issues as part of a more resilient, green and inclusive recovery as countries invest large sums of money in their economies to fight the pandemic. The UK has already taken important steps and also stopped new funding for fossil fuel projects overseas, a first and is therefore in a unique position to achieve the shared goal of a just transition to a green pandemic.

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