A World Bank report has made two contrasting forecasts about economic recovery in the developed and developing countries in the post-coronavirus pandemic situation. In its latest report, the bank has predicted that economies in developed countries will grow by 5.6% this year than the estimate made in January. These countries are now expected to expand 1.5% faster than the earlier projection mainly as a result of extensive coverage of corona vaccination. This would be the fastest rate of recovery post- recession in the past 80 years. However, emerging economies would rebound at a slower rate because of the slow vaccination process due to lack of resources and the relatively more serious financial shock that the pandemic caused in these countries.
The World Bank has reduced its growth projections for 40% of emerging and developing economies and says these countries can bounce back only if helped by the giant Chinese economy, otherwise they are expected to grow by a mere 4.4% in the current year. The bank foresees a bleak picture for poor nations as they are expected to expand by only 2.9% this year, the slowest growth in 20 years except the previous year. In order to put developing and poor nations back on track, the bank has recommended combined international efforts to help these countries come out of the economic slowdown by ensuring a fair distribution of vaccines and debt relief. So far, international lending agencies have taken several measures to provide debt relief to developing and poor nations. The United Nations has regularly been pleading for an equitable distribution of corona-cure medicine.
The World Bank has also made a gloomy prediction that by the end of 2021 more than 100 million are feared to have been pushed back into extreme poverty. People living in extreme poverty have little access to food, healthcare, education, shelter and other essentials. The bank says it would take most economies another three years or even more to get back to the pre-pandemic levels.
Published in The Express Tribune, June 11h, 2021.