OECD upgrades forecast for 2021 development of global economy, expects increase of 5.8 pc

The Organisation for Economic Co-operation and Development (OECD) has revised up its forecast for the 2021 global GDP growth, predicting an increase of 5.8 per cent.

According to the OECD's Economic Outlook released on Monday prospects for the world economy have brightened but the recovery is likely to remain uneven and, crucially, dependent on the effectiveness of public health measures and policy support.

The report highlighted that in many advanced economies more and more people are being vaccinated, government stimulus is helping to boost demand and businesses are adapting better to the restrictions to prevent the spread of the virus.

"But elsewhere, including in many emerging-market economies where access to vaccines as well as the scope for government support are limited, the economic recovery will be modest," it said.

"Global economic growth is now expected to be 5.8 per cent this year, a sharp upwards revision from the December 2020 Economic Outlook projection of 4.2 per cent for 2021. The vaccines rollout in many of the advanced economies has been driving the improvement, as has the massive fiscal stimulus by the United States," the report read.

In 2022, the global economy is expected to grow by 4.4 per cent, according to the OECD, noting that while prospects for the world economy have brightened, it is not an ordinary recovery."It is likely to remain uneven and dependent on the effectiveness of vaccination programmes and public health policies," the report added.

The OECD expects US to grow by 6.9 per cent in 2021 instead of 3.5 per cent predicted in the December report, while keeping the forecast for 2022 the same, with a 3.6 per cent increase expected.

Meanwhile, OECD has cut its growth projection for India to 9.9 per cent this year from 12.6 per cent estimated earlier in March.

"In India, the rapid rebound in activity since mid-2020 has paused with resurgence of the COVID-19 pandemic and renewed localised containment measures raising uncertainty and hitting mobility," it said in its latest Economic Outlook.

( With inputs from ANI )