Although the economies of China and the United States are making rapid recoveries following the worst of the Covid-19 Pandemic, other nations and economists around the world worry that they will fall behind, unable to keep up with the recovery of the two largest global economies.
As nations continue to deal with the repercussions of the Covid-19 Pandemic, it is clear that they will recover at unequal rates. “In fact, what we see is a multi-speed recovery, increasingly powered by two engines — the US and China,” Kristalina Georgieva, managing director of the International Monetary Fund, said last week. With high hopes for global recovery, Georgieva feels that more government spending and rapidly increasing vaccination rates in the United States will help fuel recovery in other places around the world. Overall, Georgieva and the IMF predict a 5.5 percent growth to the global economy in 2021.
Georgieva’s comments on economic recovery are a precursor to virtual IMF meetings that are scheduled to take place throughout the week. The meetings will address the rate of recovery around the world.
While 5.5 percent is the predicted growth rate around the world, the United States is prepared to shatter expectations by the end of the year. Already, employers in the United States added 916,000 jobs to the economy in March, on top of the hundreds of thousands added in February. Additionally, the industries most impacted by the pandemic are the ones showing the most strength and growth. Restaurants, bars, construction, education, and delivery services all saw an uptick in the number of available jobs this month. Manufacturing also saw an increase — contributing to the record-breaking S&P 500 data from last Thursday. Additionally, the DOW index jumped to a record high after gaining 370 points and the unemployment rate in the United States fell to six percent. Today, April 5, will be the first chance investors have to respond to the new economic data.
Outside of the United States, however, things look a bit grimmer in terms of economic recovery. An increase in the total number of Covid-19 cases and a decrease in global vaccination rates as a result of distrust of the AstraZeneca vaccine could bring recovery to a standstill. Further, poor countries continue to struggle with vaccine availability and face worsening job loss and poverty.
In the United States, around 19 percent of the total population, or around 61 million people, has been fully vaccinated against Covid-19. Over the past weekend, nearly 4 million vaccinations were given in 24 hours — among the fastest of any country around the world. Although vaccine efforts are continuing in other countries, they are lagging far behind the United States. The World Health Organization stated that vaccination rates in Europe are “unacceptably slow,” while India reported a record-high number of daily Covid-19 cases. India has already given 76 million doses of the vaccine, but that only amounts to one percent of the country’s total population of 1.3 billion.