China is likely to lead the rebound of East Asia and Pacific economies in 2021. This is according to new World Bank forecasts. However, many nations will show sub-par growth as they struggle to emerge from the COVID-19 pandemic.
Based on the World Bank’s latest East Asia and Pacific Economic Update, China’s economy will boost by 8.1% in 2021. Meanwhile, in the previous year, it boosted by 2.3%. Furthermore, they expect China’s economy to power a 7.4% region-wide expansion, up from 1.2% in the last year.
Moreover, Vietnam is the other outstanding economic performer with an anticipated growth rate of 6.6%, up from 2.9%. Significantly, China and Vietnam were among the relatively few countries that were only lightly hurt by the COVID-19 pandemic and did not fall into recession in 2020.
Coronavirus is proving hard to suppress even a year after confirmation of the first case in Wuhan.
Slow suppression of coronavirus could lead to worse-than-expected economic activity
Furthermore, it remarked that economic growth for individual nation-states will depend on containing the novel coronavirus, their ability to take advantage of the recovery of international trade, and the capacity of governments to provide fiscal and monetary support.
Moreover, the report says that global economic revival, supported in part by the significant U.S. stimulus, will improve trade in goods and could provide an external boost to the growth of as much as 1 percentage point on average. They added that global tourism is likely to remain below pre-pandemic levels till 2023. There will be a delay in economic rebound in economies that depend largely on tourism.
The World Bank announced successful vaccination campaigns and early control of the epidemic, significant policy reform, could lead to better-the-expected growth.
Still, slow suppression of coronavirus could lead to worse-than-expected economic activity. This will raise the risk of new mutations that could be more infectious, fatal, and resistant to existing vaccines.