The Organization for Economic Cooperation and Development (OECD) improved Mexico’s economic growth expectation and projects it to increase 6.3% in 2021, it said, 1.3 percentage points more than it had planned in May of this year.
According to his estimates, he predicts that in 2022 the Mexican economy will grow around 3.4%.
Meanwhile, the world economy will grow this year by 5.7%, the organization estimated on Tuesday, which considers that there is a “very uneven” recovery in the face of the Covid-19 crisis.
“Economic growth has picked up this year, helped by strong political support, the deployment of effective vaccines, and the resumption of many economic activities,” the organization writes in a report.
For 2022, it foresees an expansion of 4.5%.
The global Gross Domestic Product (GDP) thus recovers “its pre-pandemic level”, but “production and employment gaps remain in many countries”, especially where “vaccination rates are low”, he points out.
“The lack of vaccination worldwide puts us all at risk,” OECD chief economist Laurence Boone told a news conference, expressing concern about emerging and low-income countries.
The Secretary General of the UN, Antonio Guterres, already criticized days ago the global slowness to promote vaccination. The “COVID-19 epidemic is a wake-up call, but we are still sleeping,” he said.
In the case of the growth forecasts of other Latin American economies, it indicates that for Argentina it will be 7.6% and Brazil 5.2%.
However, “some countries have limited room for manoeuvre to provide broad support for activity, particularly those where inflationary pressures are already rising and benchmark interest rates have risen,” such as Brazil and Mexico, according to the report.
“Inflationary pressures”
After a historic contraction in 2020 due to the measures adopted to curb the spread of the coronavirus, the recovery is thus “very uneven, with singularly different results in different countries”, according to the OECD.
The organization lowered by 0.9% the growth of the United States in 2021 compared to the projections of May, which would stand at 6%, although the forecast for the Eurozone increases (5.3%, +1).
According to Boone, the downward revision of the US projection is due to the “delta variant hit hard” the world’s leading economy, although it is recovering again “very strongly”.
For its part, Germany would be the only one of the main economies of the European Union (EU) to see its forecast fall, to 2.9% (-0.4), compared to France (6.3%, +0.5), Italy (5.9%, +1.4) and Spain (6.8%, +0.9).
“Strong macroeconomic policy support and accommodative financial conditions should continue to underpin demand in advanced countries,” the OECD said, referring to the EU stimulus package and the US infrastructure plan.
The growth forecast for China, the engine of the world economy, remains at 8.5% for the current year.
Regarding inflation, OECD forecasts point to 3.6% in 2021 in the United States, 2.1% in the Eurozone, 5.4% in Mexico and 7.2% in Brazil, as well as 47% in Argentina.
provisional #PerspectivasEconómicas:
?The #inflación increased in the United States and in some emerging markets ➡️ will eventually fall.
? Inflation is expected in the #G20 peak at the end of 2021 and decline throughout 2022.
?https://t.co/6Q9bkXXLAG pic.twitter.com/wdhCBsi8rl
— OECD ➡️ Better Policies for a Better Life (@ocdeenespanol) September 21, 2021
“We think this is a temporary phenomenon,” said the organization’s secretary general, Mathias Cormann.
Laurence Boone said, however, that they are closely monitoring a possible transmission of the increase in prices to rapid and generalized wage progressions, a “spiral” that they want to avoid and that “for the moment” did not happen.
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